QUESTION

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True/False. Briefly explain your answer. a. Assume the money market is in equilibrium. The Bank of Canada has decided to purchase government bonds in an open market operation. The result of this action will be a decrease in the interest rate as the supply of bonds will increase. b. Central Bank can impose expansionary monetary policy by decreasing tax rate. c. After the terrorist attacks on September 11, 2001, governments raised expenditures to increase security at airports, these purchases of goods and services are not included in GDP since governments will have to raise taxes to pay for them. d. The Zymeworks Inc Company has $\$ 10$ million in cash, which it has accumulated from retained earnings. It was planning to use the money to build a new factory. Recently, the rate of interest has increased, The increase in the rate of interest should not influence the decision to build the factory because the Zymeworks Inc doesnt have to borrow any money.

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