Which of the Following Would Be Most Indicative of a Shift

question 108

Multiple Choice

Which of the following would be most indicative of a shift to a more expansionary monetary policy?

• A) Rapid expansion in the monetary base, higher  short-term interest rates, and  a decline in the growth rate of the M1 money supply
• B) Rapid expansion in the monetary base, declining  short-term  interest rates, and  an increase in the growth rate of the M2 money supply
• C) A reduction in the monetary   base, higher  short-term  interest rates, and a decline in the growth rate of the M1 money supply
• D) A reduction in the monetary base, lower short-term interest rates, and a decline in the growth rate of the M2 money supply

---

Definitions:

Anchoring And Adjustment Heuristic

A cognitive bias where an individual relies too heavily on an initial piece of information (anchor) to make subsequent judgments or decisions.

Readily Available

Something that is easily accessible or obtainable without much effort or delay.

Decision-making Process

The mental procedure of choosing an option from several possibilities.

Evaluating Results

The process of analyzing outcomes and performance against set goals or benchmarks to determine their success or areas for improvement.