If Alan Greenspan had reduced the money supply to limit the housing bubble, the result would have been a
A) limiting of how high house values rose.
B) less significant recession than eventually occurred.
C) slowdown in overall economic growth.
D) Each of these answers is correct.

Question

Quizplus · Accepted Answer

If Alan Greenspan had reduced the money supply to limit the housing bubble, it would have likely limited how high house values rose, resulting in a less significant recession than eventually occurred. However, it would also have led to a slowdown in overall economic growth, as reducing the money supply tends to have a contractionary effect on the economy. Therefore, each of the answer choices is correct.

If Alan Greenspan Had Reduced the Money Supply to Limit