Beginning from a Position of Long- Run Equilibrium, an Expansionary

question 49

Multiple Choice

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

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

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