The Bank of Canada Explains the Transmission Mechanism for Monetary

Multiple Choice

The Bank of Canada explains the transmission mechanism for monetary policy in terms of:

A) a change in interest rates and exchange rates causing changes in demand, costs and prices and inflation.
B) a change in money supply somehow changing the inflation rate.
C) a change in government expenditure causing changes in demand, costs and prices and inflation.
D) a change in interest rates and exchange rates causing changes in government budget balances and debt ratios.