Question

Monetary policy a. must be described in terms of interest-rate targets. b. can be described either in terms of the money supply or in terms of the interest rate. c. cannot be accurately described in terms of the interest rate or in terms of the money supply. d. must be described in terms of money-supply targets.

Answer 1

Answer:

b. can be described either in terms of the money supply or in terms of the interest rate. 

Explanation:

Monetary policies are all policies enacted by the Central bank to control money supply and interest rate in order to achieve certain macroeconomic objectives.

Monetary policy can be expansionary or contractionary.

Expansionary monetary policy is carried out when the objective is to stimulate economic activities. They include open market purchase and lowering interest rates.

Contractionary monetary policy is carried out when the objective to reduce money supply. The Central bank can increase interest and rate and carry out an open market sale.

I hope my answer helps you