Author Question: According to the interest-rate-based perspective on the monetary policy transmission mechanism A) ... (Read 110 times)

michelleunicorn · **on:** Jun 30, 2018

According to the interest-rate-based perspective on the monetary policy transmission mechanism

A) changes in the money supply have little influence on macroeconomic variables.
B) key channels of monetary policy indirectly ultimately relate money supply changes to total planned spending through indirect effects on planned investment.
C) inflation is always caused by excessive monetary growth and changes in the money supply offset aggregate demand only directly.
D) monetary policy leads to increases in the price level but will have no effect on the rate of output.

Question 2

The principle that as one input increases while the other inputs are held fixed, output increases at a decreasing rate is known as the

A) marginal principle. B) principle of diminishing returns.
C) principle of opportunity cost. D) spillover principle.