Beginning from a Position of Long-Run Equilibrium,a Contractionary Monetary Policy

question 22

Multiple Choice

Beginning from a position of long-run equilibrium,a contractionary monetary policy by the Bank of Canada causes

• A)a fall in most market interest rates.
• B)an increase in the general price level.
• C)aggregate demand for goods and services to exceed potential output.
• D)potential output to exceed aggregate demand for goods and services.
• E)an increase in potential output.

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