Respuesta :
The correct answer is a: true. Other things equal, an expansionary monetary policy will shift the economy's aggregate demand curve to the right.
Short-term interest rates are lowered or the money supply is increased more quickly than usual as a result of expansionary monetary policy. It is implemented by central banks and accomplished through interest rate setting, reserve requirements, and open market activities. Expanding aggregate demand is the main goal of expansionary policy in order to offset gaps in private demand. It is founded on Keynesian economic principles, particularly the notion that a lack of aggregate demand is the primary reason for recessions.
From the standpoint of fiscal policy, the government implements expansionary measures by giving citizens additional money through budgeting instruments. Budget deficits result from higher spending and lower taxation, which means that more money is going into the economy than is being taken out.
Other things equal, an expansionary monetary policy will shift the economy's aggregate demand curve to the right.
a. true
b. false
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