In 2007 and 2008,Canada was affected by the global financial crisis that had begun with the U.S.housing collapse.By 2009,the Canadian economy had entered a recession,largely due to a reduction in investment and a ________.The policy objective for the Bank of Canada and the government at this time was to ________.

Question

Quizplus · Accepted Answer

The correct answer is A because during the 2007-2008 financial crisis, Canada's economy was impacted by a fall in net exports due to reduced global demand. The policy objective of the Bank of Canada and the government was to stimulate the economy by shifting the Aggregate Demand (AD) curve to the right to close the recessionary output gap, which is consistent with efforts to boost economic activity and counteract the recession.

In 2007 and 2008,Canada Was Affected by the Global Financial