Which of the following statements is correct regarding an interest rate above equilibrium?

Question 16 options:

a)	It will result in a shortage of money in the money market.

b)	It is a result of people demanding too much money.

c)	It is the normal state of affairs.

d)	It will result in a surplus of money in the money market.

Question 17 (1 point)

In Canada, who controls the supply of money?

Question 17 options:

a)	The Department of Finance.

b)	The market.

c)	Canadian Chartered Banks.

d)	The Bank of Canada.

Question 18 (1 point)

How is the Bank of Canada able to affect the supply of money?

Question 18 options:

a)	By influencing the level of bank reserves.

b)	By using fiscal policy effectively.

c)	By emphasizing importance of financial literacy for Canadian.

d)	By controlling the number of banks allowed to carry on business.

Question 19 (1 point)

What is government spending on goods and services in excess of net tax revenue called?

Question 19 options:

a)	A budget deficit.

b)	Monetizing the debt.

c)	Pro-cyclical fiscal policy.

d)	A budget surplus.

Question 20 (1 point)

What is the effect of an increase in the money supply?

Question 20 options:

a)	It will increase the interest rate.

b)	It will decrease the demand for money.

c)	It will decrease the quantity of investment spending.

d)	It will lower the interest rate.