Which of the Following Is Not True About Monetary Policy

question 112

Multiple Choice

Which of the following is not true about monetary policy?

• A)Contractionary monetary policy is often more effective at reducing the rate of economic growth than expansionary monetary policy is at increasing the rate of economic growth.
• B)The burden of contractionary monetary policy is not spread evenly among the population.
• C)Contractionary monetary policy can reduce export earnings.
• D)The full effect of monetary policy impacts the economy immediately, as unlike fiscal policy, monetary policy is not subject to time lags.

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Definitions:

Annual Rate

Annual rate typically refers to the interest rate for a loan or investment calculated on an annual basis, providing a basis for comparison with other financial products.

Interest

The charge for borrowing money, usually expressed as a percentage of the amount borrowed.

Future Value

The estimated worth of an investment or amount of money at a specific future date, taking into account factors like interest rates or investment growth.

Annuity

A financial product that pays out a fixed stream of payments to an individual, typically used as part of a retirement strategy.