When the Bank of Canada Enters the Open Market and Buys

question 42

Multiple Choice

When the Bank of Canada enters the open market and buys or sells government securities,we refer to this as

• A)monetary policy.
• B)commercial lending.
• C)changing the target reserve ratio.
• D)setting the target ratio.
• E)open-market operations.

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Definitions:

Externality Problems

Situations where the actions of individuals or businesses have effects on third parties that are not accounted for in the market price.

Cost-Benefit Analysis

A systematic approach to estimating the strengths and weaknesses of alternatives used to determine the best action to achieve benefits while minimizing costs.

Textbook Selection Committee

A group of individuals, often educators, who evaluate and recommend textbooks for adoption in educational settings.

Analytical Level

The degree or scale of examination or scrutiny applied when reviewing a concept, scenario, or data set.