An expansionary monetary policy results in lower interest rates,which in turn

Question

Quizplus · Accepted Answer

An expansionary monetary policy typically leads to lower interest rates, which can make domestic financial instruments less attractive to foreign investors, reducing the demand for the domestic currency on foreign exchange markets. This can lower the international price (exchange rate) of the currency, making domestic goods cheaper for foreigners and thus increasing net exports.

An Expansionary Monetary Policy Results in Lower Interest Rates,which in Turn