An alternative way to achieve some of the benefits if the Friedman rule would be to

Question

Quizplus · Accepted Answer

Paying interest on the component of outside money held by financial institutions as deposits at the central bank would create an opportunity cost for holding money, which would increase the velocity of money and provide the same benefits as the Friedman rule. This is commonly known as the "interest on reserves" policy, and many central banks around the world have adopted it as a monetary policy tool. The other choices are not directly related to the Friedman rule or would have negative economic consequences.

An Alternative Way to Achieve Some of the Benefits If