When the IMF provides loans to developing countries, it often requires these countries to adopt:
A)contractionary monetary and fiscal policies.
B)a contractionary monetary policy and an expansionary fiscal policy.
C)a contractionary fiscal policy and an expansionary monetary policy.
D)expansionary monetary and fiscal policies.

Question

Quizplus · Accepted Answer

The IMF typically requires countries to adopt contractionary monetary and fiscal policies as part of its loan conditions. These policies are aimed at reducing inflation and stabilizing the economy by decreasing government spending and increasing interest rates.

When the IMF Provides Loans to Developing Countries, It Often