An Expansionary Monetary Policy Results in Lower Interest Rates, Which

question 198

Multiple Choice

An expansionary monetary policy results in lower interest rates, which in turn

• A) increases foreign demand for U.S. financial instruments, raising the international price of the dollar and reducing net exports.
• B) increases the foreign demand for U.S. financial instruments, lowering the international price of the dollar and decreasing net exports.
• C) reduces the international price of the dollar and increases net exports.
• D) reduces the foreign demand for U.S. financial instruments and reduce net exports.