Monetary policy

1.       Monetary policy has little effect on which of the following economic outcomes?a) Budget deficit. b) Inflation. c) Technological change. d) Stability of the financial system. e) Long-term productivity growth.

2.       Compared to fiscal policy, monetary policy is the preferred tool to fight inflation and smooth out business cycles because_______  a) monetary policy is more sensitive to politics. b) monetary policy is more flexible. c) fiscal policy can be reversed faster. d) monetary policy is more discretionary.

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