The accounting scandals in 2001 counteracted the expansionary monetary policy at that time primarily through their effect on
A) asymmetric information.
B) bank deposits.
C) net exports.
D) all of the above.

Question

Quizplus · Accepted Answer

The accounting scandals in 2001 primarily affected expansionary monetary policy through their impact on asymmetric information. They increased uncertainty and mistrust in financial markets, making it harder for businesses to raise capital and for banks to assess creditworthiness.

The Accounting Scandals in 2001 Counteracted the Expansionary Monetary Policy