Which of the Following Best Defines the Bank Rate

question 118

Multiple Choice

Which of the following best defines the bank rate?

• A)It is the interest rate the Bank of Canada charges banks.
• B)It is one divided by the difference between one and the reserve ratio.
• C)It is the interest rate banks receive on reserve deposits with Bank of Canada.
• D)It is the interest rate that banks charge on overnight loans to other banks.

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Definitions:

Complement Rate

In insurance, it refers to the percentage of coverage that an insurance company does not cover under a coinsurance clause; effectively, it is the portion of the cost that the policyholder must pay after insurance.

Discount Date

The deadline by which a payment must be made to avail of a cash discount for early payment.

Due Date

The specific day by which a payment, project, or assignment is required to be completed or submitted.

Complement Rate

In the context of interest rates, this refers to the difference between 100% and the stated rate, used in various financial calculations.