___________ determines the supply of money.

Question 1 options:

a)	The interest rate

b)	The demand for money

c)	The level of nominal income

d)	The Bank of Canada

Question 2 (1 point)

A recession often begins with a(n) ________ in spending by firms on capital goods and a(n) ________ in spending on durable goods by households.

Question 2 options:

a)	decrease; increase

b)	increase; increase

c)	increase; decrease

d)	decrease; decrease

Question 3 (1 point)

What is the effect of expansionary monetary policy?

Question 3 options:

a)	An increase in the money demand leading to an increase in the interest rate, and an increase in investment spending, causing an increase in GDP.

b)	An increase in the money supply leading to a decrease in the interest rate, and an increase in the quantity of investment spending, causing an increase in GDP.

c)	An increase in the money supply leading to an increase in the interest rate, and a decrease in investment spending, causing a decrease in GDP.

d)	An increase in the money supply leading to an increase in the interest rate, and an increase in investment spending, causing an increase in GDP.

Question 4 (1 point)

Which of the following is true about the Bank of Canada?

Question 4 options:

a)	It the sole issuer of the economy's currency.

b)	It is state-owned.

c)	It is the bankers' bank.

d)	All of these.

Question 5 (1 point)

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Rising prices erode the value of money as a ________ and as a ________.

Question 5 options:

a)	medium of exchange; store of value

b)	store of value; unit of liquidity

c)	unit of barter; unit of account

d)	store of value; unit of barter

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