Monetary policy, Managerial Economics

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Monetary policies

This is the direction of the economy through the variables of money supply and the price of money.  Expanding the supply of money and lowering the rate of interest should have the effect of stimulating the economy, while a policy designed to reduce price and wage inflation by requesting voluntary restraint or by imposing statutory controls contracting the supply and raising the rate of interest should have a restraining effect upon the economy.  


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