In the Channel System, to Keep the Overnight Rate Above

question 68

Multiple Choice

In the channel system, to keep the overnight rate above the desired minimum, the central bank must sometimes

• A) buy securities.
• B) sell securities.
• C) both of the above.
• D) neither of the above.

---

Definitions:

Pure Strategy Equilibria

A situation in game theory where all players have chosen a strategy and have no incentive to change, leading to a stable outcome.

Maximin Strategy

A decision rule used in game theory and decision making to maximize the minimum possible payoff, focusing on minimizing losses in the worst-case scenario.

Dam Fund

A financial pool created to fund the construction, maintenance, or repair of dam infrastructure.

Constant-Sum

A situation in which the total resources available are fixed, and one party's gain is another party's loss.