The bank rate is decreased. The central bank sells bonds on the open market. The central bank uses open market operations to conduct contractionary monetary policy. AD decreases AD decreases The central bank uses open mark AD increases uct expansionary monetary policy. The money supply is increased. The Bank of Canada buys bonds from private banks. Price level ADI AD2 AS Real GDP Price level ADI AD2 AS

The bank rate is decreased. The central bank sells bonds on the open market. The central bank uses open market operations to conduct contractionary monetary policy. AD decreases AD decreases The central bank uses open mark AD increases uct expansionary monetary policy. The money supply is increased. The Bank of Canada buys bonds from private banks. Price level ADI AD2 AS Real GDP Price level ADI AD2 AS

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Figure: 6-1 Price Level D 0000 Refer to Figure 6-1. How would an increase in the money supply move the economy in the long run? from C to B from C to A Quantity of Output from C to A to C again from C to D
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