The expansion in the monetary aggregates was particularly rapid from 1975 to 1978, and that expansion (along with the oil shocks) led to ________.

Question

Quizplus · Accepted Answer

The rapid expansion in monetary aggregates led to serious inflation and a decline in the dollar's value. This is because an increase in the money supply typically leads to higher prices and reduces the purchasing power of each unit of currency. The oil shocks also contributed to inflation during this period by driving up the cost of energy and other goods.

The Expansion in the Monetary Aggregates Was Particularly Rapid from 1975