1. (12 Marks) What has the Bank of Canada targeted as an acceptable level of inflation in Canada? What are the causes of the high level of inflation in Canada so far in 2022? Do some research and determine what Canada has done since early 2022 to combat inflation.

2. (6 Marks) Provide detailed explanations regarding demand and supply to explain the following events for the air travel market.

a) The shortage of baggage handlers and check-in staff at Pearson International.

b) A decrease in landing fees.

C) An increase in terrorist activities.