If the real risk-free interest rate rises, the:
a. Demand curve for real loanable funds rises.
b. Demand curve for real loanable funds falls.
c. Supply curve of real loanable funds falls.
d. None of the above.
Question 2
What happens to the Canadian monetary base if there is an excess supply of 100 million euros in the Canadian dollar:euro foreign exchange market, which the Bank of Canada purchases?
a. The Canadian monetary base falls by 100 million euros worth of Canadian dollars.
b. The Canadian monetary base falls. The amount depends on the size of the money multiplier
c. The Canadian monetary base might fall or rise.
d. The Canadian monetary base rises by 100 million euros worth of Canadian dollars.
e. The Canadian monetary base rises. The amount depends on the size of the money multiplier.