How Can the Bank of Canada Use the Bank Rate

question 96

Multiple Choice

How can the Bank of Canada use the bank rate to regulate the overnight loans rate?

• A)The overnight loans rate is set at a quarter percentage point above the bank rate, which in turn is set by the Bank of Canada.
• B)The bank rate is set at the settlement balances rate plus 0.25 percentage points.
• C)The bank rate is set at 0.25 percentage points below the settlement balances rate, which is used to determine the overnight loans rate.
• D)The overnight loans rate is set at 25 basis points above the bank rate.
• E)The bank rate is set at the target overnight rate plus 0.25 percentage points.

---

Definitions:

Living Together

A situation where two or more people, often in a romantic relationship, share a common residence without being legally married.

Chance of Divorce

A statistical measure that estimates the probability of a marriage ending in divorce based on various demographic, socio-economic, and personal factors.

Divorced Parents

Individuals who have legally dissolved their marriage and are typically involved in co-parenting their children if any.

Likely to Divorce

A term describing couples or marriages that present characteristics or behaviors statistically associated with a higher probability of ending in divorce.