Suppose the Bank of Canada chooses to expand the M2 measure of money supply by exactly $10 million.The Bank could implement this expansion by
A) buying $10 million worth of government securities on the open market.
B) selling $10 million worth of government securities on the open market.
C) increasing reserves at the commercial banks by $10 million.
D) decreasing reserves at the commercial banks by $10 million.
E) None of the above would lead to an increase of M2 by $10 million.
Correct Answer:
Verified
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