Monetary policy is less effective than it was in the past because
A) investment has become less sensitive to interest rate changes.
B) the substitution effect of an interest rate change on consumption has increased.
C) the income effect of an interest rate change on consumption has increased.
D) the government deficit has decreased.

Question

Quizplus · Accepted Answer

The Answer of Monetary policy is less effective than it was in the past because
A) investment has become less sensitive to interest rate changes.
B) the substitution effect of an interest rate change on consumption has increased.
C) the income effect of an interest rate change on consumption has increased.
D) the government deficit has decreased.

Monetary Policy Is Less Effective Than It Was in the Past