Economics (Irwin Economics)
21st Edition
ISBN: 9781259723223
Author: Campbell R. McConnell, Stanley L. Brue, Sean Masaki Flynn Dr.
Publisher: McGraw-Hill Education
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Question
Chapter 36.4, Problem 1QQ
To determine
Objective of expansionary monetary policy .
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Students have asked these similar questions
The primary objective of monetary policy is
a.
To control base lending rates.
b.
To maintain price stability by ensuring low rates of inflation.
c.
To prevent imported inflation.
d.
As a substitute for fiscal policy.
The Bank of Canada can increase the interest rates by
bonds in the open market. This is
an example of
monetary policies.
a. Selling; expansionary
b. Buying; expansionary
C.
Buying; contractionary
d. Selling; contractionary
The multiplier is an indication of the capacity of money injected in the economy to
a. increase investment
b. increase welfare
c. increase consumption
d. increase interest rate
e. increase GDP
Chapter 36 Solutions
Economics (Irwin Economics)
Ch. 36.1 - Prob. 1QQCh. 36.1 - Prob. 2QQCh. 36.1 - Prob. 3QQCh. 36.1 - Prob. 4QQCh. 36.4 - Prob. 1QQCh. 36.4 - Prob. 2QQCh. 36.4 - Prob. 3QQCh. 36.4 - Prob. 4QQCh. 36.5 - Prob. 1QQCh. 36.5 - Prob. 2QQ
Ch. 36.5 - Prob. 3QQCh. 36.5 - Prob. 4QQCh. 36 - Prob. 1DQCh. 36 - Prob. 2DQCh. 36 - Prob. 3DQCh. 36 - Prob. 4DQCh. 36 - Prob. 5DQCh. 36 - Prob. 6DQCh. 36 - Prob. 7DQCh. 36 - Prob. 8DQCh. 36 - Prob. 1RQCh. 36 - Prob. 2RQCh. 36 - Prob. 3RQCh. 36 - Prob. 4RQCh. 36 - Prob. 5RQCh. 36 - Prob. 6RQCh. 36 - Prob. 7RQCh. 36 - Prob. 8RQCh. 36 - Prob. 9RQCh. 36 - Prob. 1PCh. 36 - Prob. 2PCh. 36 - Prob. 3PCh. 36 - Prob. 4PCh. 36 - Prob. 5PCh. 36 - Prob. 6PCh. 36 - Prob. 7P
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Similar questions
- Which of the following statements about money that is correct? A. Inflation brings a rising value of money. B. A work of art is an example of money because it can act as a store of value. C. Money is a completely stable store of value. D. Without a medium of exchange, goods and services must be exchanged directly for other goods and services.arrow_forward20. The type of monetary policy that is used in Canada, New Zealand, and the UK is Question 20 options: a) interest-rate targeting. b) inflation targeting. c) monetary targeting. d) targeting with an implicit nominal anchor.arrow_forwardA goal of monetary policy and fiscal policy is to a. offset the shifts in aggregate demand and thereby eliminate unemployment. b. enhance the shifts in aggregate demand and thereby increase economic growth. c. enhance the shifts in aggregate demand and thereby create fluctuations in output and employment. d. offset shifts in aggregate demand and thereby stabilize the economy.arrow_forward
- If the Bank of Canada wanted to reduce GDP, it could Select one: a. decrease the reserve requirement or implement an open market sale. b. increase the reserve requirement or implement an open market sale. c. increase the reserve requirement or implement an open market purchase. d. decrease the reserve requirement or implement an open market purchase.arrow_forwardWhich of the following is NOT part of monetary policy? *a. influencing the demand for goods and servicesb. attaining price stabilityc. managing the availability and cost of money and creditd. imposing taxes on goods and servicese. none of the choicesarrow_forwardMonetary policy is difficult to conduct because A. the tools available don't work. B. politicians frequently block the policy's intended outcomes. C. the interest rate always rises. D. the monetary policy transmission process is long and drawn out. E. it takes several years for the real GDP growth rate to respond to a change in the interest rate.arrow_forward
- Based on the money market model, when real GDP increases, the equilibrium interest rate should Select one: a. increase the same percentage as the money supply increase. b. increase. c. stay the same. d. decrease.arrow_forwardA 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.arrow_forwardThe U.S. monetary policy is conducted to achieve two goals of price stability and fullemployment output. In the short run, monetary policy can influence economic activity through the monetary transmission mechanism. Which of the following is false?a. Monetary expansion tends to encourage consumption by lowering the interest rate. b. Monetary expansion tends to encourage investment by lowering the interest rate. c. Monetary expansion tends to lead to appreciation of the domestic currency, which encourages the foreign imports.d. Monetary contraction leads to lower asset prices, which tends to discourage investment.e. All of the above are correctarrow_forward
- The central bank announces that it expects inflation to be relatively low while unemployment rises in the following months. What would be an expected monetary policy action as a result of this forecast? a. Increase government spending. b. Decrease the discount rate. c. Increase the reserve ration. d. Sell bonds on the open market. e. Decrease marginal income tax rates.arrow_forwardWhich of the following is a monetary policy to combat a recession 1. cutting taxes. 2. increasing money supply. 3. increasing government spending. 4. decreasing money supply.arrow_forwardThe central bank in Jamica decides to pursue anexpansionary monetary policy.(i) Identify one possible action they could take.(ii) Explain, in as much detail as possible, how the chosen action will impact the money market. (iii) Illustrate the overall impact of the chosen action on the money market.arrow_forward
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