The answer should be not over one single page for each questions and I need a diagram...

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Economics

The answershould be not over one single page for eachquestions and I need a diagram for numbertwo. please draw a diagram as well.
simplify isokay as long as it's correct
please help me.
1 . If the bank ofCanada sells some of its holdings of bonds to the chartered banks,the bank will use some of their reserves but in doing so it willadd to the money supply
2.Illustrate andExplain how monetary policy can be destabilizing and how a monetaryrule could work to reduce the amplitude of the business cycle

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3.7 Ratings (615 Votes)

1 When the bank of Canada sells some bonds to the charteredbanks the banks give money in order to get the bonds This leadsto a decrease in the money supply in the economy Thus it is notcorrect that if the bank of Canada will sell bonds to any bankthere will be an increase in the money supply in the economyThis will have further effects on the See Answer

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