The primary tool the Bank of Canada uses to control the money supply is

Question

Quizplus · Accepted Answer

Open market operations involve the buying or selling of government securities by the Bank of Canada in order to influence the amount of reserves in the banking system and ultimately control the money supply. This is the primary tool used by the Bank of Canada to control the money supply. Changing the desired reserve ratio, bank rate, and federal funds rate are also tools used by the Bank of Canada, but they are not the primary tool.

The Primary Tool the Bank of Canada Uses to Control