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How may the bank of Canada influence the price level? A) By conducting open-market sales and...

How may the bank of Canada influence the price level?

A) By conducting open-market sales and raising the bank rate

B) By conducting open-market sales and lowering the bank rate

C) By conducting open market purchases and raising the bank rate

D) By conducting open-market purchases and lowering the bank rate

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Answer #1

Correct option: (D) By conducting open market purchases and lowering the bank rate

Reason: By conducting open market purchases of securities as well as reducing bank rate will increase the money supply in the economy, leading to an increase in the price level.

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