Monetary policy designed to slow down economic activity is called _____ monetary policy.A.expansionaryB.inflationaryC.contractionaryD.deflationary

Contractionary monetary policy:Question 33Select one:a.deals with reduced government spending and/or increased taxes.b.results in increased domestic farm prices, export prices, and input prices.c.deals with increasing government spending and/or decreasing tax rates.d.deals with increasing money supply in the economy and/or decreasing interest rates.e.deals with decreasing money supply in the economy and/or increasing interest rates.

Expansionary monetary policy involves:Question 23Select one:a.Decreasing money supply and increasing interest ratesb.Increasing money supply and decreasing interest ratesc.Decreasing both money supply and government expendituresd.Decreasing both the government spending and taxese.Decreasing both interest rates and taxes.

Which economic tool would most likely be used as part of a contractionary monetary policy?A.Lowering interest on reservesB.Reducing the discount rateC.Raising the reserve requirementD.Buying treasury securitiesSUBMITarrow_backPREVIOUS

The manipulation of taxes and federal spending in order to stimulate the economy or reduce inflation is known as expansionary or contractionary (one word) policy.

Which economic tool would most likely be used as part of an expansionary monetary policy?A.Reducing the discount rateB.Increasing interest on reservesC.Selling treasury securitiesD.Raising the reserve requirement