Which of the Following Statements Is True About Monetary Policy

question 114

Multiple Choice

Which of the following statements is true about monetary policy and the unemployment rate?

• A) Expansionary monetary policy can decrease the unemployment rate in the short run and in the long run.
• B) Expansionary monetary policy has no effect on the unemployment rate in the short run or in the long run.
• C) Contractionary monetary policy can decrease the unemployment rate in the short run but has no effect on the unemployment rate in the long run.
• D) Contractionary monetary policy has no effect on the unemployment rate in the short run or in the long run.
• E) Expansionary monetary policy can decrease the unemployment rate in the short run but has no effect on the unemployment rate in the long run.

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