A key causal link in the interest-rate-based transmission mechanism for monetary policy is from

Question

Quizplus · Accepted Answer

A key causal link in the interest-rate-based transmission mechanism for monetary policy is from a monetary policy action (such as changing the policy interest rate or conducting open market operations) to excess reserves in the banking system. This affects the supply of money, which in turn influences interest rates and ultimately impacts investment and consumption decisions.

A Key Causal Link in the Interest-Rate-Based Transmission Mechanism for Monetary