Table 11.3 -Refer to Table 11.3.Consider the Hypothetical Information in the Table

Multiple Choice

Table 11.3
-Refer to Table 11.3.Consider the hypothetical information in the table above for potential real GDP, real GDP, and the price level in 2017 and in 2018 if the Bank of Canada does not use monetary policy.If the Bank of Canada wants to keep real GDP at its potential level in 2018, it should

A) buy government securities.
B) sell government securities.
C) increase the desired reserve ratio.
D) increase income taxes.
E) raise the target for the overnight rate.