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The central bank of  Wakanda  has established a channel system to set the value ...

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The central bank of Wakanda has established a channel system to set the value of its monetary policy interest rate. The width of the channel is 50 basis points and the aim is to have the target value of the policy rate lie in the centre of the channel. Its current target value for the policy rate is 1%. At what interest rate will the central bank of Wakanda be willing to lend to banks who wish to borrow reserves overnight?

 

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