In the early 1980s,when the Bank of Canada was focusing its attention on reducing the growth rate of the money supply,an unplanned surge in ________ led to an unintended tight monetary policy which caused ________.
A) money demand; decreased inflation and a serious recession
B) money supply; a drop in the overnight lending rate and increased investment
C) desired investment; inflation to increase
D) desired investment; the Bank of Canada to adopt a core inflation targeting policy
E) money supply; the Bank of Canada to apologize to the public for its policy error
Correct Answer:
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