Which of the following best describes the process of open market sales conducted by the Bank of Canada?
A)The Bank of Canada sells Treasury bills, which increases the money supply.
B)The Bank of Canada sells Treasury bills, which decreases the money supply.
C)The Bank of Canada borrows from member banks, which increases the money supply.
D)The Bank of Canada lends money to member banks, which decreases the money supply.

Question

Quizplus · Accepted Answer

The process of open market sales conducted by the Bank of Canada involves the selling of Treasury bills, which decreases the money supply. This is because the money used to purchase the Treasury bills is removed from circulation.

Which of the Following Best Describes the Process of Open