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ECO102H1 Lecture 38: Lecture 38-Expansionary Monetary Policy (Review)

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copperclam445
1 Aug 2010
School
UTSG
Department
Economics
Course
ECO102H1
Professor
Jack Carr

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Tuesday, March 16th, 2010
Expansionary Monetary Policy (Review)
Transmission Mechanism
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International Channel
Domestic Currency depreciates ($US/$C falls) => Exports [X] 9
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Expansionary Monetary Policy (includes international)
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Related Questions

Describe expansionary monetary policy and contractionary monetary policy.
Monetary policy could be procyclical if the Federal Reserve:
 
(i) is late recognizing that a recession has begun and conducts expansionary monetary policy.
(ii) is quick to recognize that a recession has begun and conducts expansionary monetary policy.
(iii) is late recognizing that a recession has begun and does not conduct expansionary monetary policy.
(iv) is quick to recognize that a recession has begun and does not conduct expansionary monetary policy.

1. Lowering interest rates is a common monetary policy tool used to;

A. stimulate economic growth.

B.lower inflation.

C.decrease government borrowing costs.

D.none of these

2. Lower interest rates can also;

A.push prices lower.

B.push prices were higher.

C.lead to stagnation.

D.none of these

3. When central banks increase the money supply and take steps to lower interest rates it is known as;

A.expansionary monetary policy.

B.an inflation hawk stance.

C.contractionary monetary policy.

D.expansionary fiscal policy.

4. When Governments increase expenditures it is known as;

A.expansionary fiscal policy.

B.Contractionary fiscal policy.

C.contractionary monetary policy.

D.expansionary monetary policy.