Contractionary Monetary Policy Occurs When

question 134

Multiple Choice

Contractionary monetary policy occurs when

• A) a central bank acts to decrease the money supply in an effort to control an economy that is expanding too quickly.
• B) Congress and the president increase taxes in an effort to control an economy that is expanding too quickly.
• C) Congress and the president decrease taxes in an effort to stimulate the economy.
• D) a central bank acts to increase the money supply in an effort to stimulate the economy.
• E) a central bank acts to increase government spending in an effort to stimulate the economy.

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Definitions:

Direct Expenses

Costs that can be directly attributed to a specific product, service, or project, such as raw material costs.

Market Trends

The general direction in which a market or the prices of a particular set of goods and services is moving.

Corporate Centre

The central unit within a corporation that oversees and supports the activities of its various divisions and operations.

Responsibility Centre

A business unit or department for which its manager is accountable for certain activities and financial performance.