Which of the Following Best Describes the Outcome of an Increase

question 181

Multiple Choice

Which of the following best describes the outcome of an increase in the bank rate?

• A)Banks will borrow more from Bank of Canada, so reserves increase.
• B)Banks will borrow more from Bank of Canada, so reserves decrease.
• C)Banks will borrow less from Bank of Canada, so reserves increase.
• D)Banks will borrow less from Bank of Canada, so reserves decrease.

---

Definitions:

Annual Dividend

The total dividend payment a company distributes to its shareholders in a single fiscal year.

Constant Rate

A stable, unchanging rate, often referring to growth rates, interest rates, or other financial metrics that do not fluctuate over a specified period.

Share

A unit of ownership interest in a corporation or financial asset, giving the holder a proportionate claim on the company’s assets and profits.

Annual Dividend

The total dividend payment a company distributes to its shareholders for each share held over the course of a year.