Which of the Following Statements Is Not Correct? When Implementing

question 15

Multiple Choice

Which of the following statements is not correct? When implementing Repos open market operations the Reserve Bank of Australia (RBA) :

• A)announces before the auction the interest rate that banks have to pay to acquire ESF.
• B)usually buys securities from banks with the commitment to resell them at an agreed later date.
• C)serves the banks with the best interest rates in their bids until the exhaustion of the amount of ESF it intended to inject in the banking sector.
• D)invites banks to bid to acquire ESF.

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Definitions:

Equilibrium Price

The price at which the quantity of a product offered for sale equals the quantity of the product in demand.

Assembly Line Technology

A manufacturing process in which parts are added to a product in a sequential manner to create a finished product faster and more efficiently.

Recession

A period of decline in economic activity lasting more than a few months, as reflected by falling output, employment, income, and other aggregate measures.

Equilibrium Price

The price at which the quantity of a good demanded by consumers equals the quantity supplied by producers, resulting in a stable market condition.