Multiple Choice
Which statement below best expresses the relationship between the 3- month Treasury bill rate and the overnight loans rate? The rates are
A) not similar because the treasury bill rate is set by the Government of Canada whereas the overnight loans rate is set by the Bank of Canada.
B) not similar because the treasury bill rate is established through the financial markets whereas the overnight loans rate is set by the Bank of Canada.
C) similar because banks can readily substitute between them.
D) not similar because banks can not readily substitute between them.
E) similar because they are both required to remain with the Bank of Canada's operating band.
Correct Answer:
Verified
Correct Answer:
Verified
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