Asked by eliza mason on May 19, 2024
Verified
To the monetarists,the key to maintaining stable economic growth is
A) balancing the federal budget.
B) maintaining adequate aggregate supply.
C) maintaining a constant and low increase in money supply.
D) maintaining adequate aggregate demanD.
Monetarists
An economic philosophy highlighting the importance of government intervention in regulating the money supply.
Economic Growth
An increase in the production of goods and services in an economy over a period of time, usually measured by GDP.
Money Supply
The total amount of money available in an economy at a specific time, including cash, coins, and balances held in checking and savings accounts.
- Identify the core beliefs of monetarists concerning money supply and economic policy.
Verified Answer
HJ
Henry JimenezMay 23, 2024
Final Answer :
C
Explanation :
Monetarists believe that maintaining a constant and low increase in the money supply is essential to achieving stable economic growth. This is because they believe that changes in the money supply directly impact prices and inflation, and thus maintaining a stable money supply can help prevent inflation and promote economic stability. Balancing the federal budget and maintaining adequate aggregate supply and demand may also be important factors, but they are not typically seen as central to the monetarist approach.
Learning Objectives
- Identify the core beliefs of monetarists concerning money supply and economic policy.