Through open market operations,the Bank of Canada
A) controls the demand for reserves, but not the supply of reserves, in the banking system.
B) controls the supply of reserves and the demand for reserves in the banking system.
C) controls the supply of reserves, but not the demand for reserves, in the banking system.
D) has influence over, but cannot directly control, the supply of reserves and the demand for reserves in the banking system.

Question

Quizplus · Accepted Answer

The Bank of Canada controls the supply of reserves in the banking system through open market operations by buying or selling government securities, but it does not directly control the demand for reserves.

Through Open Market Operations,the Bank of Canada