1. Under the monetarist policy or quantity theory of money what do monetarists assume will happen if the Bank of Canada increases the money supply? Discuss the model and its potential effect on inflation in the short run and long run.
2. The US government imposes a 15% tariff on Canadian steel exports. Discuss the impact this tariff has on Canadian steel producers, Canadian consumers, US steel producers, US consumers and the US government.

These are practice exams questions so please give thorough explanations.