Economists who favor activist monetary policy argue that

Question

Quizplus · Accepted Answer

Economists who favor activist monetary policy argue that the economy may not always equilibrate quickly enough at the Natural Real GDP or full-employment output and therefore needs help, and activist monetary policy is effective at smoothing out the business cycle. They also argue that activist monetary policy is flexible and flexibility is a desirable quality in monetary policy. Therefore, all options (a,b,c) are correct.

Economists Who Favor Activist Monetary Policy Argue That