Which school of thought believes that expansionary monetary policy is effective in fighting recessions? I. classical macroeconomics
II) Great Moderation consensus
A) I only
B) II only
C) I and II
D) neither I nor II

Question

Quizplus · Accepted Answer

The classical macroeconomic school of thought generally does not support expansionary monetary policy as an effective way to fight recessions, while the Great Moderation consensus suggests that monetary policy can be effective but does not necessarily see it as the only or best approach. Therefore, neither option I or II fully aligns with the belief that expansionary monetary policy is effective in fighting recessions. Thus, the correct answer is B, II only.

Which School of Thought Believes That Expansionary Monetary Policy Is