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Because of the Liquidity Trap, the Bank of Canada's Creation

Question 96

Multiple Choice

Because of the liquidity trap, the Bank of Canada's creation of billions of dollars in excess reserves during the great recession had:


A) little or no effect on lending by the chartered banks.
B) a significant effect on lending by the chartered banks.
C) the effect of increasing the overnight lending rate.
D) the effect of increasing the bank rate.

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