The overnight lending rate is the rate at which:
A)The Bank of Canada borrows from investment dealers.
B)The Bank of Canada borrows from the chartered banks.
C)the chartered banks, investment dealers, and other financial market participants borrow and lend funds for one day.
D)The Bank of Canada lends to the Department of Finance.

Question

Quizplus · Accepted Answer

The overnight lending rate is the rate at which financial market participants, including chartered banks and investment dealers, borrow and lend funds for a period of one day. The Bank of Canada may influence this rate through its monetary policy actions, but it does not directly borrow from or lend to specific institutions at this rate.

The Overnight Lending Rate Is the Rate at Which