The purpose of an expansionary monetary policy is to shift the:
A)aggregate expenditures curve downward.
B)aggregate demand curve rightward.
C)aggregate supply curve leftward.
D)investment demand curve leftward.

Question

Quizplus · Accepted Answer

An expansionary monetary policy involves increasing the money supply, lowering interest rates, and encouraging borrowing and spending. This leads to an increase in aggregate demand, as consumers and businesses have more money to spend and invest. Therefore, an expansionary monetary policy shifts the aggregate demand curve rightward.

The Purpose of an Expansionary Monetary Policy Is to Shift