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Large Value Transfer System (LVTS) participants can make a payment only if they
____.
A) have positive settlement balances in their accounts with the Bank of Canada
B) have posted collateral (such as Government of Canada treasury bills and bonds)
C) have explicit lines of credit with other participants
D) All of the above.
Answer: D
Diff: 1 Type: MC Page Ref: 404
Skill: Recall
Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
Canada
The Large Value Transfer System (LVTS) ____.
A) is the core of the Canadian payments system
B) is an electronic net settlement network designed to provide settlement to wholesale
transactions
C) is an electronic net settlement network designed to provide settlement to paper-based payment
items
D) Only A and B of the above.
Answer: D
Diff: 1 Type: MC Page Ref: 404
Skill: Recall
Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
Canada
Where only the net credit or debit position of each participant vis-à-vis all other participants is
calculated is known as ____.
A) multilateral netting
B) principal-agent netting
C) moral hazard netting
D) credit risk netting
Answer: A
Diff: 1 Type: MC Page Ref: 405
Skill: Recall
Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
Canada