Repo rate is the rate at which Reserve Bank of India $\text{(RBI)}$ lends commercial banks, and reverse repo rate is the rate at which $\text{(RBI)}$ borrows money from commercial banks.
Which of the following statements can be inferred from the above passage?
- Decrease in repo rate will increase cost of borrowing and decrease lending by commercial banks.
- Increase in repo rate will decrease cost of borrowing and increase lending by commercial banks.
- Increase in repo rate will decrease cost of borrowing and decrease lending by commercial banks.
- Decrease in repo rate will decrease cost of borrowing and increase lending by commercial banks.
