Suppose Canada Is Experiencing a 12 Percent Rate of Unemployment

question 111

Multiple Choice

Suppose Canada is experiencing a 12 percent rate of unemployment with stable prices and a trade deficit.All else equal, the use of appropriate monetary policy to reduce unemployment would:

• A)cause the dollar to appreciate in value.
• B)have no impact upon our trade deficit.
• C)decrease our trade deficit.
• D)increase our trade deficit.

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Definitions:

Direct Regulation

A method of regulation where government agencies set explicit rules or standards that restrict certain actions or outcomes, often involving monitoring and enforcement.

Positive Externalities

Benefits that a third-party or society gains from a transaction or activity they are not directly involved in.

Third Parties

Entities that are involved in a transaction or relationship but are not the main parties; in economics, often refers to intermediaries or external stakeholders.

LoJacks

A brand name for a stolen vehicle recovery system that allows vehicles to be tracked by police after they are stolen.