Question

The effective Fed Funds Rate is the_________.

A rate charged by the largest members of the Federal Reserve System.
B averaged rate of member banks throughout the United States.
C highest rate charged by member banks, calculated on Wednesdays.
D lowest rate charged by member banks, calculated on Wednesdays.

Answer 1

The answer would be B

Step-by-step explanation:

The effective federal funds rate is the interest rate banks charge each other for overnight loans to meet their reserve requirements. Also known as the federal funds rate, the effective federal funds rate is set by the Federal Open Market Committee, or FOMC.