Monetarists believe that:

Question

Quizplus · Accepted Answer

Monetarists believe that a fixed increase in the rate of growth of the money supply is better than discretionary policies because it leads to a stable and predictable outcome, which can help to avoid economic instability. They argue that countercyclical policies, such as fiscal stimulus, can cause more harm than good by distorting market signals and leading to inflation. Additionally, Monetarists believe that full employment is not the norm and that fluctuations in unemployment are caused by changes in the money supply.

Monetarists Believe That