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Question 2? (15 points) Suppose the following developments occur in the Canadian economy. Consider them separately and independently of each other: a. Members of the
Question 2? (15 points) Suppose the following developments occur in the Canadian economy. Consider them separately and independently of each other: a. Members of the public decide to increase the amount of currency they hold in their pockets, instead of their bank accounts. b. Commercial banks decide to hold smaller reseryes. c. Bank of Canada sells government bonds. In each case - explain what happens to money supply in the economy - briefly discuss the impact on Canada's GD P, considering both the domestic sectors of the economy as well as the export-im port sector
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