Which of the following sequence of events follows an expansionary monetary policy?

Question

Quizplus · Accepted Answer

An expansionary monetary policy leads to an increase in the money supply, which lowers the interest rate. A lower interest rate increases investment and consumption, which leads to an increase in aggregate demand and output. This sequence of events is reflected in choice C, where increased consumption and investment lead to an increase in output and employment.

Which of the Following Sequence of Events Follows an Expansionary