The central bank moved away from a monetary growth rule because _____ was/were unstable.
A) the economy
B) the money supply
C) the velocity of money
D) interest rates

Question

Quizplus · Accepted Answer

The velocity of money was unstable, meaning that changes in the money supply did not consistently produce predictable changes in economic activity. As a result, the central bank shifted away from a monetary growth rule and began to focus more on interest rate targeting to stabilize the economy.

The Central Bank Moved Away from a Monetary Growth Rule