The Objective of the Bank of Canada's Monetary Policy Is

question 66

Multiple Choice

The objective of the Bank of Canada's monetary policy is

• A)to keep the overnight loans rate below 2 percent a year and the unemployment rate at its natural rate.
• B)to keep the labour force participation rate above 80 percent, the inflation rate below 2 percent a year, and the exchange rate fluctuating by less than 3 percent a year.
• C)to keep the unemployment rate below 5 percent, the inflation rate between 1 and 3 percent a year, and long- term interest rates below 4 percent a year.
• D)to keep the unemployment rate below 5 percent, the inflation rate between 1 and 3 percent a year, and long- term real GDP growth above 4 percent a year.
• E)to control the quantity of money and interest rates to avoid inflation and when possible prevent excessive swings in real GDP growth and unemployment.

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