Unanticipated expansionary monetary policy will increase economic growth and push inflation upward while lowering real interest rates. This will cause

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Quizplus · Accepted Answer

An unanticipated expansionary monetary policy typically lowers real interest rates, making domestic assets less attractive to foreign investors. This leads to an increase in the demand for foreign currencies as investors seek higher returns elsewhere, causing a decline in the foreign exchange value of the dollar.

Unanticipated Expansionary Monetary Policy Will Increase Economic Growth and Push