Consider the Monetary Transmission Mechanism

Multiple Choice

Consider the monetary transmission mechanism.In an open economy,such as Canada's,a decrease in the money supply leads to a rise in the interest rate.This is followed by

A) an outflow of financial capital and an appreciation of the Canadian dollar.
B) an inflow of financial capital and a depreciation of the Canadian dollar.
C) an outflow of financial capital and a depreciation of the Canadian dollar.
D) an inflow of financial capital and an appreciation of the Canadian dollar.