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The Bank of Canada Has Announced That It Plans to Lower

Question 26

Multiple Choice

The Bank of Canada has announced that it plans to lower the rate of monetary growth from 10% per year to 2% per year.You would expect this announcement to directly


A) increase money demand,shifting the LM curve up.
B) increase money demand,shifting the LM curve down.
C) decrease money demand,shifting the LM curve up.
D) decrease money demand,shifting the LM curve down.

Correct Answer:

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