In response to the global financial crisis of 2008-2009,the International Monetary Fund began to:
A) exercise tight controls on fiscal policy of the borrowing countries.
B) encourage activities that resulted in high inflation rates.
C) display inflexibility in policy responses.
D) urge countries to adopt policies that included fiscal stimulus and monetary easing.
E) adopt a "one-size-fits-all" approach to macroeconomic policy.

Question

Quizplus · Accepted Answer

The International Monetary Fund urged countries to adopt policies that included fiscal stimulus and monetary easing in response to the global financial crisis of 2008-2009. This approach aimed to encourage economic activity and prevent further economic decline. Other options such as tight controls on fiscal policy, high inflation rates, and inflexibility in policy responses would have likely worsened the economic situation. The IMF did not adopt a "one-size-fits-all" approach to macroeconomic policy but instead recognized the unique circumstances and needs of each country.

In Response to the Global Financial Crisis of 2008-2009,the International