Question: Need help. Please explain right answer. Suppose that the Bank of Canada is trying to eliminate an inflationary gap by changing the money supply. One
Need help. Please explain right answer.

Suppose that the Bank of Canada is trying to eliminate an inflationary gap by changing the money supply. One of the consequences of this action on the Canadian dollar exchange rate is O A. an appreciation of the Canadian dollar, which will lead to a reduction in imports. O B. an appreciation of the Canadian dollar, which will lead to a reduction in net exports. O C. a reduction of investor confidence in the Canadian economy, which will lead to a depreciation of the Canadian dollar. O D. an increase in interest rates, which will lower domestic investment and result in capital inflows and a depreciation of the Canadian dollar. O E. a decrease in interest rates, which will appreciate the Canadian dollar and raise exports
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