GK
INDIAN ECONOMY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Which of the following policies may be used to increase money supply and lower interest rates?
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Expansionary fiscal policy
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Contractionary fiscal policy
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Expansionary monetary policy
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Contractionary monetary policy
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Explanation:
Detailed explanation-1: -This is a monetary policy that aims to increase the money supply in the economy by decreasing interest rates, purchasing government securities by central banks, and lowering the reserve requirements for banks.
Detailed explanation-2: -An expansionary policy aims to increase the money supply.
Detailed explanation-3: -What is monetary policy and why is it important? Central banks use monetary policy to manage economic fluctuations and achieve price stability, which means that inflation is low and stable.
There is 1 question to complete.