The transmission channel related to changing the money supply,followed by changes in short-term rates and pressure on interest rates to change the cost of funds,and consequently to influence economic activity,is known as a:

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The monetary policy channel describes the process through which changes in the money supply, initiated by central bank actions, lead to adjustments in short-term interest rates. These adjustments then influence the broader spectrum of interest rates, affecting the cost of borrowing and, ultimately, economic activity. This channel is a fundamental concept in understanding how monetary policy operates to influence the economy.

The Transmission Channel Related to Changing the Money Supply,followed by Changes