A policy that results in slow and steady growth of the money supply is an example of A-an “easy” monetary policy. B-a “passive” monetary policy. C-a “practical” monetary policy. D-an “active” monetary policy.
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A policy that results in slow and steady growth of the money supply is an example of
A-an “easy”
B-a “passive” monetary policy.
C-a “practical” monetary policy.
D-an “active” monetary policy.
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- Describe a situation where a central bank would want to implement expansionary monetary policy. Describe a situation where a central bank would want to implement contractionary monetary policy. Suggest a policy tool that the central bank (e.g., the Federal Reserve) can use for one of the above situations and explain how that policy would alleviate the situation.Which of the following is true for monetary policy? Select one: a. As a contractionary monetary policy, the Bank of Canada can increase the target for the overnight rate. b. As an expansionary monetary policy, the central bank can buy bonds from the public to reduce a inflationary gap. c. The central bank can sell bonds during an economic downturn in order to stabilize the economy. d. The central bank can use open market operations to change the target for the overnight rate.When the economy slows down heading towards a recession, then the appropriate monetary policy would be ... Group of answer choices a. Expansionary b. Contractionary
- Assume the economy has entered a recession. Identify two monetary policy actions that could be used to alleviate the recession and explain how each policy would improve the economy.Suppose that the Bank of Canada determines that the Canadian economy is currently overproducing. What can the Central Bank do to slow down economic activity? a. The Central bank can pursue an expansionary monetary policy by increasing the money supply, causing a decrease in the interest rate. As a result, real GDP will increase and the price level will increase. b. The Central bank can pursue a contractionary monetary policy by decreasing the money supply, causing a decrease in the interest rate. As a result, real GDP will decrease and the price level will decrease c. The Central bank can pursue a contractionary monetary policy by decreasing the money supply, causing an increase in the interest rate. As a result, real GDP will decrease and the price level will decrease. d. The Central bank can pursue a contractionary monetary policy by decreasing the money supply, causing an increase in the interest rate. As a result, real GDP will decrease and the price level will increase e. The…What is the main argument for having a Central Bank independent from the government for the purposes of monetary policy? Select one: a. An independent Central Bank would have more resources available to devote towards implementing monetary policy b. An independent Central Bank would be more knowledgeable about the state of the economy. Consequently, the Central Bank would be better suited to implementing monetary policy c. The Central Bank is more credible in its inflation and cash rate targets. Consequently, inflation expectations will adjust appropriately to monetary policy announcements d. Having an independent Central Bank prevents any economic trade-offs when making monetary policy choices
- a) Below is a monetary policy that could be implemented by the government. Please explain the following policy: Policy: The government will use the other policy, expansionary monetary policy for the small firms which can buy loans to reduce the discount rate due to which it will be possible from them to take more credit and invest it in their business.Which of the following is true of monetary policy? a. If the Fed wants to increase the money supply, it should increase the interest rate it pays banks on their reserves. b. The long and variable lags between a shift in monetary policy and when the policy shift affects output and employment makes it easier for the Fed to time monetary policy properly. c. A monetary policy that maintains price stability provides the foundation for both economic stability and the smooth operation of a market economy. d. The Fed should try to push real interest rates to the lowest possible level in order to stimulate investment and aggregate demand.Which of the following best describes an contractionary monetary policy? *a. more spendingb. more savingsc. increase in money supplyd. lower interest ratese. none of the choices
- a) Identify the four major tools of monetary policy. b) How can monetary policy address the problem of inflation?In what situation is the use of Monetary Policy not effective? In all situations monetary policy is effective. When the economy experienced excessive economic growth When the economy experiences a very severe recession When the economy experiences stagflationwhat is a fiscal policy what is a monetary policy -give an example in todays economy. thanks for your time
