In a Floor System

question 24

Multiple Choice

In a floor system

• A)the central bank's deposit rate determines the overnight interest rate.
• B)interest rates are highly variable.
• C)the central bank must intervene each day to achieve its interest rate target.
• D)the central bank's lending rate determines the overnight interest rate.
• E)reserves are essentially zero.

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Definitions:

Effective

Having the desired result or outcome; achieving the intended goal efficiently and successfully.

Surviving

The act of continuing to live or exist, especially in spite of challenging conditions or circumstances.

Tom Burns

A sociologist known for his work in organizational theory, particularly regarding the dynamics of industrial society.

Level of Effectiveness

A measure of how well an action achieves its intended outcome or objectives.