Which of the following is not a limitation to monetary policy?
A)The fact that fiscal policy is sometimes at odds with monetary.
B)The world has become global in all markets including financial markets, and the Fed does not have control over international banks or non-member banks.
C)Because the Federal Reserve System is made up of twelve branches, it is essentially very difficult to get a decision enacted by the Board of Governors.
D)Monetary policy has to be carried out through the commercial banking system.

Question

Which of the following is not a limitation to monetary policy?​
A)​The fact that fiscal policy is sometimes at odds with monetary.
B)​The world has become global in all markets including financial markets, and the Fed does not have control over international banks or non-member banks.
C)​Because the Federal Reserve System is made up of twelve branches, it is essentially very difficult to get a decision enacted by the Board of Governors.
D)​Monetary policy has to be carried out through the commercial banking system.

Quizplus · Accepted Answer

The fact that fiscal policy is sometimes at odds with monetary (option A) and the world being global in financial markets (option B) are both limitations to monetary policy. Option D is also a limitation because it restricts the direct control the Federal Reserve has over the economy, as it needs to rely on commercial banks to carry out monetary policy. However, option C is incorrect because the fact that the Federal Reserve has twelve branches does not limit monetary policy directly. Instead, it is an organizational structure that can create delays or difficulties in implementing policy decisions but is not a fundamental limitation to the effectiveness of monetary policy.

Which of the Following Is Not a Limitation to Monetary