Choose the Statement That Is Incorrect

question 6

Multiple Choice

Choose the statement that is incorrect.

• A)The Bank of Canada's choice of policy instrument is the overnight loans rate.
• B)When the Bank of Canada wants to slow inflation, it raises the overnight loans rate.
• C)The Bank has established 12 fixed dates each year on which it announces its overnight rate target for the coming period.
• D)Recently, the overnight loans rate has been at historically low levels because the Bank is leaning in the direction of avoiding recession.
• E)The overnight rate was a bit more than 8 percent a year in 1995.

---

Definitions:

Increased Value

The appreciation or rise in the worth of an asset or investment over a period of time.

Variance

A measure of the spread between numbers in a data set, indicating how much the numbers differ from the mean.

Arithmetic Average

A statistical measure of central tendency calculated by summing a set of values and dividing by the number of values in the set.

Geometric Average

A method of calculating the average rate of return that accounts for compounding, commonly used for investment portfolios.