When the Bank of Canada Sells Government Securities, Banks Have

question 117

Multiple Choice

When the Bank of Canada sells government securities, banks have ______ money to lend and economic growth ______.

• A) less; will slow
• B) less; will accelerate
• C) more; will slow
• D) more; will accelerate

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Definitions:

Demonetization

The act of stripping a currency unit of its status as legal tender, usually to replace it with new notes or coins.

Political Instability

A situation where a country experiences changes in its political environment that can affect its government's ability to govern effectively.

Depreciation

A decrease in the value of one currency relative to another currency.

Economic Disaster

An economic disaster refers to a sudden and severe downturn in the economy, leading to significant financial loss, high unemployment rates, and often a decline in the standard of living.