Which of the following is a lesson that can be learned from monetary policy during the Great Depression?
A) Monetary policy should be changed frequently in response to economic fluctuations.
B) Prolonged periods of monetary contraction will retard economic growth.
C) Low interest rates will direct an economy toward recovery.
D) Monetary policy should focus on variables such as output and employment.

Question

Quizplus · Accepted Answer

Prolonged periods of monetary contraction during the Great Depression worsened the economic downturn, highlighting the importance of avoiding tight monetary policy during economic contractions to support growth.

Which of the Following Is a Lesson That Can Be