During 1929-1933, monetary policy was
A) highly expansionary and this led to an increase in the general level of prices.
B) characterized by steady monetary growth, which resulted in price stability.
C) characterized by a sharp reduction in the supply of money, which led to downward pressure on prices and a decline in output.
D) highly expansionary and this led to a reduction in the general level of prices.

Question

Quizplus · Accepted Answer

During 1929-1933, the monetary policy was characterized by a sharp reduction in the money supply, contributing to deflation and a decline in economic output during the Great Depression.

During 1929-1933, Monetary Policy Was