The supporters of a monetary growth rule believe that active monetary policy
A)stabilizes the economy,decreasing the number of recessions and their severity.
B)destabilizes the economy,increasing the number of recessions and their severity.
C)cannot change the inflation rate.
D)cannot change real GDP.

Question

Quizplus · Accepted Answer

Supporters of a monetary growth rule argue that active monetary policy (frequent adjustments in monetary policy in response to economic changes) can destabilize the economy. They believe that it can lead to more frequent and severe recessions by introducing uncertainty and making it harder for businesses and consumers to plan for the future.

The Supporters of a Monetary Growth Rule Believe That Active