Transmission mechanism of monetary policy theory

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1. One of the most important lessons learned from the Transmission Mechanism of Monetary Policy theory is that

a. further expansion of the money supply when interest rates are near zero makes no sense.

b. there are many different ways that expanding the money supply can lead to changes in YAD other than changes in interest rates.

c. the only way that monetary policy benefits the economy is through changes in interest rates.

d. the Federal Reserve should never use inflation targeting.

2. For a single−price monopolist to sell one more unit of a? good, it must

A. raise the price on just the last unit sold.

B. raise the price on all units sold.

C. lower the price on just the last unit sold.

D. lower the price on all units sold.

Reference no: EM131393442

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