What is the impact of the Bank of Canada's policy on the equilibrium interest rate?

Question

A. The equilibrium interest rate falls.

B. The equilibrium interest rate remains unchanged.

C. The equilibrium interest rate rises.

Answer 1

C. The equilibrium interest rate rises.

By selling bonds Bank of Canada reduces money-supply (moves money from M1 to M3 but multiplier for M1 is higher than for M3).

Reducing money-supply increases interest rate and slows-down rising price-level (inflation). Output in short-run can be affected negatively.

Answer 2

b    It's been unchanged for a while.  But does the question refer to a previous time ....  or the last 3 years.....  or forever.