Answer:
a. the interest rate the Fed charges banks.
Explanation:
Discount rate -
It is the rate of interest which is charged to financial institutions like banks for the loan they take from the Federal Reserve Bank .
The commercial banks can freely borrow from the Federal reserve bank , without any collateral , but need to give a certain amount of interest which is fixed , called the discount rate .
Hence , the correct statement for discount rate is a. the interest rate the Fed charges banks.
