Question

In the case of an expansionary_____policy, the interest rate rises, while in the case of an expansionary _____ policy, the interest rate falls.
Select one:
a. fiscal; monetary
b. monetary, monetary
c. monetary, fiscal
d. fiscal; fiscal

= fiscal; monetary​

Answer 1

With an expansionary fiscal policy, the interest rate rises, while with an expansionary monetary policy, the interest rate falls.

What is an Expansionary fiscal & monetary policy?

This is when an increases in money supply is stimulated by raising spending or cut taxes while the latter is when the cost of borrowing i reduced to stimulate an economy.

Therefore, the Option A is correct.

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