If the Bank of Canada believes the economy is about to fall into recession, what actions should it take? If the Bank of Canada believes the inflation rate is about to increase, what actions should it take? If the Bank of Canada believes the economy is about to fall into recession, it should A. use an expansionary fiscal policy to increase the interest rate and shift AD to the right. O B. use a contractionary monetary policy to lower the interest rate and shift AD to the left. OC. use its judgment to do nothing and let the economy make the self adjustment back to potential GDP. O D. use an expansionary monetary policy to lower the interest rate and shift AD to the right. If the Bank of Canada believes the inflation rate is about to increase, it should O A. use a contractionary fiscal policy to increase the interest rate and shift AD to the left. O B. use an expansionary monetary policy to lower the interest rate and shift AD to the right. O C. use a combination of tax increases and spending cuts to keep the budget balanced. O D. use a contractionary monetary policy to increase the interest rate and shift AD to the left.

If the Bank of Canada believes the economy is about to fall into recession, what actions should it take? If the Bank of Canada believes the inflation rate is about to increase, what actions should it take? If the Bank of Canada believes the economy is about to fall into recession, it should A. use an expansionary fiscal policy to increase the interest rate and shift AD to the right. O B. use a contractionary monetary policy to lower the interest rate and shift AD to the left. OC. use its judgment to do nothing and let the economy make the self adjustment back to potential GDP. O D. use an expansionary monetary policy to lower the interest rate and shift AD to the right. If the Bank of Canada believes the inflation rate is about to increase, it should O A. use a contractionary fiscal policy to increase the interest rate and shift AD to the left. O B. use an expansionary monetary policy to lower the interest rate and shift AD to the right. O C. use a combination of tax increases and spending cuts to keep the budget balanced. O D. use a contractionary monetary policy to increase the interest rate and shift AD to the left.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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