One of the reasons that expansionary monetary policy has not been as effective as expected in recent years is that:

Question

Quizplus · Accepted Answer

Banks holding significant excess reserves can limit the effectiveness of expansionary monetary policy because even if the central bank increases the money supply, banks may choose not to lend out the additional reserves, thereby blunting the policy's impact on stimulating economic activity.

One of the Reasons That Expansionary Monetary Policy Has Not