The Overnight Rate or Key Interest Rate Specifies

question 301

Multiple Choice

The overnight rate or key interest rate specifies:

• A) interest on government tax receipts.
• B) interest on loans between banks.
• C) interest on government expenditures.
• D) interest on bank deposits at the Bank of Canada.

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Definitions:

Cost Method

An accounting method used to record investments where the investment is recorded at cost and is not adjusted for increases or decreases in the value of the underlying asset, except to reflect impairments.

Additional Paid-in Capital

The excess amount paid by investors over and above the par value of the shares during the issuance of stock.

Donated Treasury Stock

Shares that were once repurchased by the issuing company and are later donated to a beneficiary.

Cost Method

An accounting technique used to value inventory, usually at the lower of cost or market price, and investments in certain conditions.