Expansionary monetary policy will have what effect on the components of aggregate demand?
A)Consumption,investment,and net exports will rise.
B)Consumption and investment will rise,but net exports will fall.
C)Consumption will rise,but investment and net exports will fall.
D)Consumption will fall,but investment and net exports will rise.

Question

Quizplus · Accepted Answer

Expansionary monetary policy involves increasing the money supply, which leads to lower interest rates and increased consumer and business spending. This will cause an increase in consumption, investment, and net exports, as consumers and businesses have more money to spend and can borrow more easily at lower interest rates. Therefore, choice A is the best answer.

Expansionary Monetary Policy Will Have What Effect on the Components