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What is a potential negative effect of an expansionary policy?

decreased borrowing
increased interest rates
increased inflation
decreased available credit

Respuesta :

Answer:

increased inflation ( third choice)

A potential negative effect of an expansionary policy is increased inflation.

What is an expansionary policy?

An expansionary policy is when the money supply in an economy is increased. An expansionary policy can either be carried out by monetary authorities or the government.

When money supply is increased, inflation can be an effect. This is because more money would be chasing fewer goods.

To learn more about expansionary policy, please check: https://brainly.com/question/25716528