In 2007 and 2008,Canada Was Affected by the Global Financial

question 108

Multiple Choice

In 2007 and 2008,Canada was affected by the global financial crisis that had begun with the U.S.housing collapse.By early 2009,the Canadian economy was in a recession with Y < Y*.What economic policies were implemented to close the output gap?

• A)expansionary monetary policy
• B)expansionary fiscal policy
• C)contractionary monetary policy and contractionary fiscal policy
• D)contractionary monetary policy and expansionary fiscal policy
• E)expansionary monetary policy and expansionary fiscal policy

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Definitions:

Federal Income Taxes

Taxes levied by the national government on the annual income of individuals, corporations, trusts, and other legal entities.

Compounded Monthly

Refers to the process of calculating interest on both the initial principal and the accumulated interest from previous periods on a monthly basis.

Present Value

The calculation that determines the worth of a future amount of money or series of cash flows at the present time, factoring in a specific interest rate.

Discount Rate

The interest rate applied for calculating the present worth of anticipated cash flows in future during the discounted cash flow analysis process.