Answer Happy

Evaluate the following statements? 1) The key interest rates can be subdivided into deposit facility, main refinancing rate and marginal lending rate. 2) Key interest rates determine for example the rate at which all companies can borrow money from the central bank. 3) LIBOR and EURIBOR are interest rates that are applied when banks borrow money from other banks. Select one: A. (1) and (2) are correct. (3) is false. B. (2) and (3) are correct. (1) is false. C. (2) is correct. (1) and (3) are false. D. (1) and (3) are correct. (2) is false. Which of the following statements is correct without limitations? Select one: A. Continuous compounding follows the idea that the length of the single interest periods varies over time, e.g. becomes smaller over the lifetime of the contract and converges to zero in the end. B. With non-negative interest rates, in general it holds: the higher the interest rate is, the stronger is the effect of compounding compared to simple interest calculation. C. 30/365, Real/365 and Real/Real are the three most common types of day count conventions for interest calculations. D. None of these statements is correct.