The Fed Funds Rate Meets the Requirement for an Operating

question 2

Multiple Choice

The fed funds rate meets the requirement for an operating target. Which of the below is this requirement?

• A) The rate is readily observable and continuously available because the market for fed funds is large and active.
• B) The rate is readily observable and continuously available because the market for fed funds is small but active.
• C) The rate is readily observable and continuously available because the market for fed funds is large but inactive.
• D) The rate is often not observable or available because the market for fed funds is small and/or inactive.

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Definitions:

Over 3 Years

A term indicating a duration longer than three years.

18-36 Months

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The awareness of an individual's own personality, emotions, intentions, and wishes.

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