the economics of money, banking, and financial markets

511 #

© 2014 Pearson Canada Inc.#

21. 
    

    The Bank of Canada's operating band is ____ basis points or ____.
    A) 50; 0.5 percent
    B) 100; 1 percent
    C) 50; 5 percent
    D) 100; 10 percent
    Answer: A
    Diff: 1 Type: MC Page Ref: 406
    Skill: Recall
    Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
    Canada

    
    


22. 
    

    The overnight interest rate ____.
    A) is the shortest-term rate available
    B) forms the base of any term structure of interest rates relation
    C) is the rate the Bank of Canada charges LVTS participants with negative settlement balances at
    the end of the banking day
    D) Only A and B of the above.
    Answer: D
    Diff: 3 Type: MC Page Ref: 405
    Skill: Applied
    Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
    Canada

    
    


23. 
    

    If the operating target of the Bank of Canada is 4.5 percent then the bank rate is ____.
    A) 4.75 percent
    B) 5.25 percent
    C) 4.25 percent
    D) 4.5 percent
    Answer: A
    Diff: 2 Type: MC Page Ref: 406
    Skill: Applied
    Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
    Canada

    
    


24. 
    

    If the operating target of the Bank of Canada is 4 percent then the bank rate is ____.
    A) 4.25 percent
    B) 4.50 percent
    C) 3.5 percent
    D) 4 percent
    Answer: A
    Diff: 2 Type: MC Page Ref: 406
    Skill: Applied
    Objective List: 17.1 Characterize the framework for the implementation of monetary policy in
    Canada