which of the following examples illustrates the danger of countercyclical monetary policy? select all that apply:

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30-11-2022
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which of the following examples illustrates the danger of countercyclical monetary policy? select all that apply:

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contexto38 contexto38 · Answer 1 · 2022-12-03T21:07:14+01:00

An aggressive expansionary monetary policy and high interest rates can be identified as the examples that illustrate the danger of countercyclical monetary policy. Therefore, the options A and B hold true.

A monetary policy can be referred to or considered as a policy, which is implemented by the authorities in order to foresee an economic growth, thereby bringing a sense of stability in the financial operations within its own jurisdictions where it has been brought into effect. Moreover, it may have countercyclical illustrations.

Learn more about a monetary policy here:

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which of the following examples illustrates the danger of countercyclical monetary policy? select all that apply:

A. Aggressive expansionary monetary policy causes the economy to overshoot potential GDP and swing into an inflationary gap.

B. High interest rates implemented by the Fed to reduce inflation cause the economy to go into a recession.