Monetary policy involves:
A)the government's expenditure.
B)taxation.
C)determining the quantity of money.
D)the fiscal deficit.

Question

Quizplus · Accepted Answer

Monetary policy involves determining the quantity of money in circulation in order to achieve certain goals such as controlling inflation, promoting economic growth, and stabilizing the economy. It is usually done by a central bank through actions such as adjusting interest rates, buying or selling government bonds, and setting reserve requirements for banks. Government expenditure, taxation, and the fiscal deficit are part of fiscal policy, which is separate from monetary policy.

Monetary Policy Involves