Monetary policy involves the use of money and credit controls to impact the macroeconomy.

Question

Quizplus · Accepted Answer

Monetary policy refers to the actions taken by a central bank (such as the Federal Reserve in the US) to manage the money supply and interest rates in the economy in order to achieve specific macroeconomic objectives like controlling inflation, promoting economic growth, or stabilizing financial markets. These actions can include setting interest rates, buying or selling government securities in the open market, adjusting reserve requirements for banks, and other measures to influence the availability of credit and the cost of borrowing.

Monetary Policy Involves the Use of Money and Credit Controls