To eliminate inflationary pressures in the economy, the traditional views holds
ID: 1252815 • Letter: T
Question
To eliminate inflationary pressures in the economy, the traditional views holds that the monetary authority should seek to (increase, decrease) _______ the reserves of commercial banks; this would tend to (increase, decrease) ________ the money supply and to (increase, decrease) ________ the rate of interest. This in turn would cause investment spending, aggregate demand, and GDP to (increase, decrease) _______. This action by monetary authorities would be considered a(n) (easy, tight) ________ money policy.Explanation / Answer
decrease increase decrease increase easy