A rise in the money supply will result in a decrease in interest rates, an increase in investment spending, and an increase in GDP and aggregate demand.
What three instruments make up monetary policy?
Typically, monetary policy is categorized as either expansionary or contractionary. Reserve requirements, the discount rate, and open market operations are the three monetary policy tools that the Federal Reserve frequently employs.
What is a quizlet on monetary policy?
In order to control inflation and deflation, regulate the money supply, the cost of money, and modify interest rates to influence the economy, monetary policy must be in place.
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