Nonconventional Monetary Policy Attempts to Reduce Financial Frictions by ________

question 84

Multiple Choice

Nonconventional monetary policy attempts to reduce financial frictions by ________.

• A)correcting the shortage of liquidity that has made it costly for businesses to invest
• B)purchasing long-term assets,which raises their price and reduces the credit spread
• C)reducing the expected future short-term interest rate
• D)all of the above
• E)none of the above

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Definitions:

Delay Gratification

The ability to resist the temptation for an immediate reward and wait for a later, often greater reward.

Delay Gratification

The capacity to withstand the urge for an instant gratification in favor of a future reward.

Immediate Reward

A reward received directly after completing a task or activity, often motivating future behavior.

Overjustification Effect

A phenomenon where providing excessive external rewards for an already internally rewarding activity decreases the intrinsic motivation to perform that activity.