Question

A short-term monetary policy action would MOST LIKELY

A) lower federal taxes.
B) lower interest rates.
C) raise medicare coverage.
D) raise unemployment insurance.

Answer 1

Answer:

B) lower interest rates.

Explanation:

A short term monetary policy action would most likely lower interest rates.

Monetary policy is a policy adopted by the authoritative financial institution of a country to control interest rate and inflation levels in a country.

• A short term monetary policy is aimed at curbing interest rate.
• It is mostly targeted at the credits in the economy.
• Therefore making a tentative tight money policy effective and interest rates generally falling.