Explain the Differences Between a Monetary Policy and a Fiscal

question 24

Essay

Explain the differences between a monetary policy and a fiscal policy,and discuss why the IMF was established.

---

Definitions:

Transaction Costs

The expenses incurred when buying or selling goods or services, including costs of gathering information, negotiating, and enforcing contracts.

Double Coincidence of Wants

A condition for trade in a barter system where two parties each desire what the other has to offer.

Specialization of Labor

The process by which individuals or entities focus on a specific area of expertise, improving efficiency and production quality.

Large Denomination CDs

Certificates of Deposit (CDs) with high minimum deposit requirements, often offering higher interest rates in exchange for larger initial investments.