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Monetary Policy: The Federal Reserve

Question 5 • IL-Economics

Increasing the amount of credit that is available within an economy is done through monetary policy.

Answer
A
expansionary
B
contractionary

Explanation

Expansionary monetary policy increases the amount of money and credit available in the economy, often by lowering interest rates or making it easier for banks to lend. Contractionary policy does the opposite by restricting credit to slow economic activity.

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