What Actions Could the Bank of Canada Take to Achieve

question 23

Multiple Choice

What actions could the Bank of Canada take to achieve consistent growth in real GDP at 4 percent per year?

• A)The Bank of Canada could increase in the growth rate of the money supply by 1% each year until the inflation rate was exactly equal to 4 percent.
• B)The Bank of Canada could maintain a growth rate of the money supply of 4 percent, regardless of whether inflation was rising or falling in the economy.
• C)The Bank of Canada could follow contractionary monetary policy that would reduce the overnight interest rate to zero so investment will rise consistently.
• D)The Bank of Canada has no direct control over real GDP in the long run, so there are no actions it could take to achieve that goal.
• E)The Bank of Canada could adopt a nominal GDP growth target; increasing inflation when the economy is growing slowly.

---

Definitions:

African American Families

Family units within the African American community, often characterized by unique cultural, social, and historical influences that shape their structure, dynamics, and experiences.

Urban Communities

Populated areas within cities or towns where individuals live in close proximity to one another, often characterized by higher density of buildings and services.

Rural Communities

Rural communities refer to areas that are located outside cities and towns, typically characterized by smaller populations, lower density, and often a dependency on agricultural activities.

Subordinate

A person who is lower in rank or position, often subjected to the authority or control of another within an organization or hierarchy.