Canada's economy is experiencing high inflation and real GDP is greater than potential GDP.Describe the actions taken by the Bank of Canada to restore full employment.

The supply of loanable funds ______ and the long-term interest rate ______.

A.

decreases; rises

B.

increases; falls

C.

increases; rises

D.

decreases; falls

Part 2Investment ______, and aggregate demand ______ with a multiplier effect.

A.

increases; decreases

B.

increases; increases

C.

decreases; increases

D.

decreases; decreases