What Could Monetary Policymakers Do to Avoid Liquidity Traps in the Future

question 97

Multiple Choice

What could monetary policymakers do to avoid liquidity traps in the future?

• A) Change back to a commodity money system rather than a fiat money system.
• B) Maintain a higher inflation target.
• C) Expand the money supply more rapidly when expansion is needed.
• D) Increase the natural rate of unemployment.

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Definitions:

Motion Study

A business efficiency technique that analyzes the motions involved in performing a task to design more efficient ways of working, thereby improving productivity.

Frank and Lillian Gilbreth

Pioneers in the field of industrial engineering, known for their studies of time and motion to improve workplace efficiency.

Scientific Management

A management theory developed by Frederick W. Taylor advocating for the optimization of work through scientific methods to increase productivity.

Henry Fayol

A French industrialist and management theorist known for developing a general theory of business administration.