ince the early 1990s the Bank of Canada has made its primary target that of:

Question 11 options:

a)	keeping the unemployment rate below 4%.

b)	Keeping interest rates steady.

c)	Ensuring the stability of the Canadian dollar on international markets.

d)	Controlling inflation.

Question 12(1 point)

What happens if the Bank of Canada decreases the money supply?

Question 12 options:

a)	The bank rate will increase because of a surplus of money.

b)	The bank rate will decrease because of a surplus of money.

c)	The bank rate will decrease because of a shortage of money.

d)	The bank rate will increase because of a shortage of money.

Question 13(1 point)

Contractionary monetary policy results in which one of the following?

Question 13 options:

a)	Lower interest rates.

b)	Higher real GDP.

c)	Higher interest rates.

d)	Higher aggregate expenditures.

Question 14(1 point)

What is the purpose of the Bank of Canada?

Question 14 options:

a)	It acts as auditor and inspector of the commercial banks.

b)	All of these.

c)	It acts as a financial agent for the federal government.

d)	It supplies the economy with currency.

Question 15(1 point)

Refer to the information above to answer this question. If the supply of money is $130, what is the value of the equilibrium interest rate?

Question 15 options:

a)

4%

b)

5%

c)

7%

d)

8%

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