Compared to the Keynesian transmission mechanism,the monetarist transmission mechanism is
A) indirect and long.
B) direct and long.
C) direct and short.
D) indirect and short.

Question

Quizplus · Accepted Answer

The monetarist transmission mechanism is direct and short as it works through changes in the money supply which directly affect interest rates and aggregate demand. It is contrasted with the Keynesian transmission mechanism which is indirect and long as it operates through changes in government spending, taxes, and other fiscal policies which can take time to have an impact on the economy.

Compared to the Keynesian Transmission Mechanism,the Monetarist Transmission Mechanism Is