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In the 1975-1981 period, the Bank of Canada selected an interest rate as an operating target
than a reserve aggregate primarily because it ____.
A) had no interest in targeting a monetary aggregate, as evidenced by its unwillingness to target
a reserve aggregate
B) was still very concerned with interest rate stability
C) was committed to the real bills doctrine
D) was committed to keeping the foreign exchange and domestic bonds markets functioning
smoothly
E) None of the above
Answer: E
Diff: 1 Type: MC Page Ref: 464
Skill: Applied
Objective List: 18.4 Outline Bank of Canada policy procedures from a historical perspective
In the 1975-1981 period, the Bank of Canada selected a monetary aggregate as an
intermediate target than an interest rate primarily because it ____.
A) was concerned about inflation
B) was still very concerned with achieving interest rate stability
C) was committed to the real bills doctrine
D) was committed to keeping the foreign exchange and domestic bonds markets functioning
smoothly
Answer: A
Diff: 1 Type: MC Page Ref: 464
Skill: Applied
Objective List: 18.4 Outline Bank of Canada policy procedures from a historical perspective
In the 1975-1981 period, the Bank of Canada used ____ as the intermediate target of
monetary policy.
A) the growth rate of M1
B) the growth rate of M2
C) the interest rate
D) the exchange rate
Answer: A
Diff: 1 Type: MC Page Ref: 464
Skill: Applied
Objective List: 18.4 Outline Bank of Canada policy procedures from a historical perspective
In the 1975-1981 period, the Bank of Canada used ____ as the operating target and
____ as the intermediate target of monetary policy.
A) an interest rate; a monetary aggregate
B) a monetary aggregate; an interest rate
C) the monetary base; a monetary aggregate
D) a monetary aggregate; inflation
Answer: A
Diff: 1 Type: MC Page Ref: 464
Skill: Applied
Objective List: 18.4 Outline Bank of Canada policy procedures from a historical perspective