Discuss the contractionary monetary policy

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Reference no: EM131774322

Question: 1. According to Keynesian theory, expansionary monetary policy should be used during____, while contractionary monetary policy should be used during____.

A a surplus, a deficit

B an economic expansion, a recession

C a recession, an economic expansion

D a war, peacetime

2. which fo the following is a reliable way to obtain the same rate of return as the stock market?

A buy the stocks in a stock index such as the Dow Jones

B Buy shares of a professionally-managed hedge fund

C buy US Treasury bonds

D Buy stocks that cost less than $1.00

3. According to Say's law, shifts in ____lead to shifts in ____, causing economic growth.

A Aggregate Demand, Aggregate Supply

B Aggregate Supply, Aggregate Demand

C Investment, Interest rates

D the money supply, Aggregate Demand

4. During the Great Recession, the Fed undertook ____monetary policy, which was____ by banks accumulating $2,500 billion in excess reserves.

A expansionary, supported

B contractionary, supported

C expansionary, counteracted

D contractionary, counteracted

Reference no: EM131774322

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