The Interest Rate That Banks Charge Other Banks for Overnight

question 138

Multiple Choice

The interest rate that banks charge other banks for overnight loans is the

• A)prime rate.
• B)discount rate.
• C)federal funds rate.
• D)Treasury bill rate.

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Definitions:

Autoregressive Model

An Autoregressive Model is a statistical model for analyzing and forecasting time series data, where future values are assumed to be a linear function of past values.

Exponential Smoothing Model

A forecasting technique that applies decreasing weights to past data, with the most recent data weighted most heavily.

Mean Absolute Deviation

A measure of variability that quantifies the average of the absolute deviations of each data point from the data set's mean.

Smoothing Constant

A parameter used in exponential smoothing methods to weigh the importance of historical data in forecasting.