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:

Performance Exceeded

Surpassing the expected or required level of task completion or achievement of goals.

Management Exception

A management approach where only significant deviations from a set budget or plan are brought to the attention of management.

Concurrent Control

A management strategy that involves monitoring and adjusting ongoing activities and processes to ensure they meet the desired standards.

Bureaucratic Control

Influences behaviour through authority, policies, procedures, job descriptions, budgets and day‐to‐day supervision.