SIE Exam Practice Question 1025
Question: 1025
____ The interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight, on a collateralized basis.
Correct Answer: C
Explanation:
The Fed funds rate is the interest rate at which depository institutions (banks and credit unions) lend reserve balances to other depository institutions overnight, on a collateralized basis.
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