Question
https://www.rba.gov.au/publications/smp/2021/nov/ Section 3: Domestic Financial Conditions This question is based on your reading 'Statement on Monetary Policy'. Graph 3.12 indicates that the TFF is a
https://www.rba.gov.au/publications/smp/2021/nov/
Section 3: Domestic Financial Conditions
This question is based on your reading 'Statement on Monetary Policy'. Graph 3.12 indicates that the TFF is a Reserve Bank asset. Why is this?
Because the TFF is backed by gold
Because the TFF is the Reserve Bank's store of liquid assets.
Because the Reserve Bank extended 3-year loans to commercial banks.
None of the listed options is true
This question is based on your reading 'Statement on Monetary Policy'. Graph 3.13 shows that ESA funds represent a significant proportion of Reserve Bank liabilities. They are liabilities because
ESA's are used to store bank loans
ESA's are deposits accounts of commercial banks held by the Reserve Bank
ESA's are created when the Reserve Bank borrows currency
ESA's are created when the Reserve Bank borrows in overseas markets
This question is based on your reading 'Statement on Monetary Policy'. At the time writing, issuance of Residential Mortgage Backed Securities (RMBS) had recently increased. It followed the end of the TFF drawdown in part because
TFF drawdown was a source of funding for authorised deposit taking institutions (ADIs) and RMBS are an alternative source
ADIs were using TFF funds to purchase RMBS
TFF drawdown caused a rise in interests rates paid on RMBS
All of the listed options are correct
This question is based on your reading 'Statement on Monetary Policy'. See page 44. The shift in deposit mix during 2021 leading to higher levels of at-call deposits and a lower proportion of term deposits is
good for bank's funding costs because at-call deposits pay lower interest rates and good for bank's liquidity measures because at-call deposits are highly liquid
good for bank's funding costs because at-call deposits pay lower interest rates but bad for bank's liquidity measures because at-call deposits can be withdrawn at any time
bad for bank's funding costs because at-call deposits pay higher interest rates but good for bank's liquidity measures because at-call deposits are highly liquid
bad for bank's funding costs because at-call deposits pay higher interest rates and bad for bank's liquidity measures because at-call deposits can be withdrawn at any time
This question is based on your reading 'Statement on Monetary Policy'. From the perspective of lending institutions, which of the following statements is true?
Investor loans are considered higher risk than owner-occupier loans while principal-and-interest loans are considered higher risk than interest-only loans
Investor loans are considered higher risk than owner-occupier loans while principal-and-interest loans are considered lower risk than interest-only loans
Investor loans are considered lower risk than owner-occupier loans while principal-and-interest loans are considered higher risk than interest-only loans
Investor loans are considered lower risk than owner-occupier loans while principal-and-interest loans are considered lower risk than interest-only loans
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started