Q19 · Practice questionComplex familiar1 mark
QUESTION 19
The cash rate is the interest rate on
(A)
overnight loans between financial institutions.
(B)
every household’s mortgage contract.
(C)
all government bonds regardless of maturity.
(D)
the average return on Australian shares.
WORKED SOLUTION
1 markAnswer A
Answer
A
Working
The overnight interbank cash rate is the monetary-policy benchmark. Retail loan and deposit rates are influenced by it but also reflect funding costs, competition and risk.
Marking criteria
- Select A. [1 mark]
Practice question aligned to the current QCAA syllabus; review the worked solution and marking criteria.
View the QCAA syllabus