If the Bank of Canada Increases the Monetary Base by $40

question 208

Multiple Choice

If the Bank of Canada increases the monetary base by $40 billion through open-market operations:

• A) GDP will increase by $40 billion.
• B) the price level will increase by $40 billion.
• C) the government debt held by the public has been reduced by $40 billion.
• D) government spending has increased by $40 billion.

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