The lowering of Bank Rate by the Reserve Bank of India leads to:

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CollectorBabu · Accepted Answer

Correct Answer: More liquidity in the market. It is the rate at which the Reserve Bank is ready to buy or rediscount bills of exchange or other commercial papers. When RBI lowers the bank rate, it decreases the borrowing cost, and thereby encourages borrowing. Because of this, credit formation process and money flow increase, thereby increasing the liquidity in the market.

The lowering of Bank Rate by the Reserve Bank of India leads to:

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