Nonconventional monetary policy attempts to reduce financial frictions by ________.
A)correcting the shortage of liquidity that has made it costly for businesses to invest
B)purchasing long-term assets,which raises their price and reduces the credit spread
C)reducing the expected future short-term interest rate
D)all of the above
E)none of the above

Question

Quizplus · Accepted Answer

Nonconventional monetary policy aims to address financial frictions by using methods such as purchasing long-term assets, correcting the shortage of liquidity, and reducing expected future short-term interest rates. Therefore, option D, "all of the above," is the correct answer.

Nonconventional Monetary Policy Attempts to Reduce Financial Frictions by ________