EBK ECONOMICS
4th Edition
ISBN: 8220101443649
Author: KRUGMAN
Publisher: YUZU
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Question
Chapter 34, Problem 8P
To determine
Federal Funds Rate:
It is the rate at which any depository institution provided reserve loans to some other depository institution without any collateral.
Marginal Lending Facility Rate: It is the rate below which any bank is not allowed to lend. It is a kind of benchmark which is set by the central bank for bank rate reference.
Fixed exchange rate: Exchange rate system under which there is intervention by the government to control the fluctuation is known as fixed exchange rate.
Nominal exchange rate: the rate at which currencies are exchanged in the exchange market is known as nominal exchange rate.
Flexible exchange rate: Exchange rate system under which there is no intervention by government rather the rate is determined from demand and supply phenomenon.
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