If the central bank adjusts interest rates to maintain the demand for money in line with the given target for money supply, it is an example of:

Question

Quizplus · Accepted Answer

Adjusting interest rates to align the demand for money with a target for money supply is a strategy associated with maintaining a monetary target. This approach focuses on controlling the amount of money circulating in the economy to achieve macroeconomic objectives such as controlling inflation or stimulating growth.

If the Central Bank Adjusts Interest Rates to Maintain the Demand