When the Bank of Canada raises the overnight rate target,the ________ rate and the ________ rate usually go up by the exact same amount,but the ________ rate may or may not go up by the same amount.

Question

Quizplus · Accepted Answer

When the Bank of Canada raises the overnight rate target, the overnight rate and the prime business rate usually go up by the exact same amount, as they are directly affected by the change in the overnight rate. However, the long-term government bond rate may or may not go up by the same amount, depending on other market factors such as inflation expectations and global economic conditions. Therefore, option A is the correct answer.

When the Bank of Canada Raises the Overnight Rate Target,the