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Which action is an example of an expansionary monetary policy?
A. Lowering the interest on reserve rate
B. Selling Treasury securities
C. Raising the discount rate
D. Raising the reserve requirement
SUBMIT

Respuesta :

noemicscott
A. Lowering the interest on reserve rate.

Expansionary monetary policy increases money supply by lowering interest rates

Lowering the interest on Reserve Rates is the best example of an expansionary monetary policy.

What is Interest Rates?

Interest Rates is the amount which one receives when the person lend some amount of money to other person.

What is lowering of Interest Rates?

Lowering of interest rate is an action taken to make borrowing money cheaper. In simple words, as low as the interest rate is as much as the money will be borrowed from the market. It boost the investment and spending in business.

What are the different types of Rates used in Economic Policy?

Repo Rate, Reverse Repo Rate, SLR, etc.

What is Expansionary monetary policy?

Expansionary monetary policy is the increase of money supply in the market than usual by lowering the interest rates on short-term borrowings.

Hence Option A is the correct Answer.

To learn more about Expansionary Monetary Policy, click here

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