What Is the Main Purpose of Monetary Policy

question 78

Multiple Choice

What is the main purpose of monetary policy?

• A) to affect how much money is available to businesses and banks
• B) to control the amount of public debt sold to foreign states
• C) to control the interest rates on money lent to foreign states
• D) to equalize income disparity among citizens of the United States
• E) to expand the government's revenue base so as to reduce the deficit

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Definitions:

Financial Statement

A documented account of financial transactions and standing for businesses, individuals, or alternative entities.

Permanent/Temporary

Terms distinguishing between accounts that are not closed out or reset at the end of the accounting year (permanent accounts) and those that are (temporary accounts).

Normal Balance

The standard side (debit or credit) on which increases to an account are recorded.

Financial Statement

Reports that summarize the financial condition and operations of a business.