The Implementation of Monetary Policy (HSC SSCE Economics): Quizzes
📚Quizzes
Practise the questions
10 questions from this quiz
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Practise the questions
10 questions from this quiz
What is the cash rate?
What is the cash rate?
Rate on overnight loans in money market
How many percentage points below the target is the deposit rate (floor) normally set?
How many percentage points below the target is the deposit rate (floor) normally set?
0.25 percentage points
How many percentage points above the target is the lending rate (ceiling) set?
How many percentage points above the target is the lending rate (ceiling) set?
0.25 percentage points
How does the RBA increase the supply of ES funds through DMO?
How does the RBA increase the supply of ES funds through DMO?
Buys securities from banks
What is the main purpose of exchange settlement (ES) accounts?
What is the main purpose of exchange settlement (ES) accounts?
Enable banks to settle payments
What does the RBA do when tightening monetary policy?
What does the RBA do when tightening monetary policy?
Raises the cash rate target
Which tool is NOT an unconventional monetary policy measure?
Which tool is NOT an unconventional monetary policy measure?
Changing the cash rate target
How does unconventional policy affect the yield curve differently from conventional policy?
How does unconventional policy affect the yield curve differently from conventional policy?
Targets longer-term rates, flattens curve
How do lower interest rates encourage business investment through the interest rate channel?
How do lower interest rates encourage business investment through the interest rate channel?
Reduce borrowing costs & opportunity cost
Which factor besides the cash rate affects retail interest rates?
Which factor besides the cash rate affects retail interest rates?
Competition in banking sector