Question 37
Financial InstitutionsGuided deregulation as currently practised in Nigeria implies that
- A.market forces determine interest and exchange rates
- B.government alone determines interests and exchange rates
- C.market forces and government determine interest and exchange rates
- D.exchange rate is regulated while interest rate is fixed
Show the answer and explanation
Answer: C (market forces and government determine interest and exchange rates)
Explanation
Under guided deregulation, rates are mainly market-determined but the government (through the CBN) still steps in to guide them.