Which of the following is a monetarist solution for a recession?
A)Steady and predictable growth of the money supply.
B)A decrease in short-term interest rates.
C)An increase in the money supply alone.

Question

Quizplus · Accepted Answer

Monetarists believe that steady and predictable growth of the money supply is the key to maintaining stable economic growth and avoiding recessions. They argue that an increase in the money supply alone can lead to inflation, while a decrease in short-term interest rates may not be effective if the economy is experiencing a liquidity trap. Therefore, the best solution for a recession according to monetarists is maintaining steady and predictable growth of the money supply.

Which of the Following Is a Monetarist Solution for a Recession