Which economic perspective would be most closely associated with the view that discretionary monetary policy is an effective force for stabilizing the economy?
A) Monetarism
B) Mainstream economics
C) Rational expectations
D) New classical economics

Question

Quizplus · Accepted Answer

Mainstream economics generally supports the use of discretionary monetary policy as a tool for economic stabilization, through its emphasis on the role of central banks in managing the money supply and interest rates to achieve macroeconomic objectives. Monetarism, rational expectations, and new classical economics are all more skeptical of the effectiveness of such policies, for various reasons.

Which Economic Perspective Would Be Most Closely Associated with the View