Restrictive monetary policy first impacts the market, security prices and interest rates.
A) money, increasing, decreasing
B) capital, increasing, decreasing
C) money, decreasing, increasing
D) mortgage, increasing, decreasing
Monetary policy impacts the economy
A) by affecting real spending directly.
B) by affecting real spending through the financial sector.
C) by changing interest rates and the cost of housing.
D) all of the above
Changes in spending caused by changing security values are called the
A) liquidity effect
B) wealth effect
C) income effect
D) reactionary effect
Monetary policy probably affects all of the following except
A) housing investment.
B) consumer durable investment.
C) inventory investment.
D) federal government budget outlays.