Financial Instruments Paper 2

For an investment dealer who purchases a T-bill from the Bank of Canada at the bi-weekly auction, the _________ the price, the _______ the interest income that can be received.

Which of the following reasons best explains a probable reason why Treasury bills are attractive to money market dealers and chartered banks?

The overnight rate band is

Under the Large Value Transfer System

During the stock market crash of 1987, the Bank of Canada

The capital market is characterized by instruments that generally mature in

Bonds are debt instruments that

The principal holder of Canadian government debt is/are

The volatility of interest rates has created so much uncertainty about the real return on long-term bonds that the government of Canada introduced