If Saving Exceeds Investment, the Appropriate Countercyclical Monetary Policy Would

question 55

Multiple Choice

If saving exceeds investment, the appropriate countercyclical monetary policy would be:

• A)an increase in the reserve requirement.
• B)a cut in the discount rate.
• C)an open market sale of government bonds.
• D)an increase in the federal funds rate.

---

Definitions:

Depreciation

The methodical distribution of the expense of a physical asset throughout its lifespan, indicating the decrease in its value as time passes.

Asset

An economic resource owned or controlled by an individual or organization that is expected to produce future benefits.

Provide Services

The act of performing tasks or duties for customers or clients in exchange for compensation.

Operating Expenses

Operating expenses are the costs associated with running a company's day-to-day activities, excluding the cost of goods sold.