Which of the following statements characterizes the trend in the Canadian aggregate price level?
A) Despite fluctuations, CPI has risen significantly.
B) Canada has never experienced deflation.
C) Inflation has always been low, thanks to the Bank of Canada's policy.
D) The most recent deflation in Canada occurred in 2008.

Question

Quizplus · Accepted Answer

Despite some fluctuations, the Canadian Consumer Price Index (CPI) has generally been on an upward trend, indicating a significant increase in the aggregate price level over time. Canada has experienced periods of deflation, most recently in 2008, but has not experienced persistent deflation. The Bank of Canada's policy has played a role in keeping inflation low, but it cannot be solely credited for the low inflation that has been observed in Canada.

Which of the Following Statements Characterizes the Trend in the Canadian