Suppose the Bank of Canada purchases government securities on the open market.How will the money supply be affected?
A) The money supply will decrease.
B) The money supply will increase only if the seller of those securities is a chartered bank.
C) The money supply will increase through the system of securities dealers rather than through the chartered banking system.
D) The money supply will increase through the chartered banking system regardless of who the seller is.
Correct Answer:
Verified
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