The RBA can stimulate the economy by _____, all of which shifts the aggregate demand to the _____.

Question

BlackTom AI · Accepted Answer

The question asks how the Reserve Bank of Australia (RBA) can stimulate the economy and how that action would affect aggregate demand (AD).
Option 1 states: 'increasing the money supply; left.' Increasing the money supply tends to lower interest rates and boost spending and investment, which shifts AD to the right, not to the left. Therefore this option misstates both the policy tool and its effect.
Option 2 states: 'increasing the interest rate; right.' Raising interest rates generally dampens borrowing and spending, leading to a decrease in AD, which would shift it left, not right. Hence this choice is incorrect because the mechanism and the direction are inconsistent.
Option 3 states: 'increasing the money supply; right.' Expanding the money supply lowers borrowing costs and stimulates consumption and investment, which raises overall demand in the economy; this is a correct description of how monetary expansion shifts AD to the right.
Option 4 states: 'decreasing the interest rate; left.' While decreasing interest rates tends to boost spending and AD, the option also claims a leftward shift, which contradicts the actual effect. This makes the statement incorrect on both the tool and the outcome.
In summary, only option 3 correctly identifies the monetary policy tool (money supply expansion) and the resulting directional shift in aggregate demand (to the right), while the other options mix up either the policy tool or the direction of the AD shift.

The RBA can stimulate the economy by _, all of which shifts the aggregate demand to the _.

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The RBA can stimulate the economy by _____, all of which shifts the aggregate demand to the _____.

查看解析

登录即可查看完整答案

类似问题

Which of the following agencies has primary responsibility for setting monetary policy and regulating the banking system?

Why is psychology important in a country’s monetary policy?

If the economy is producing an equilibrium real output that is less than potential output, a(n):

If the cash rate is increased, the RBA is trying to:

Select the option that correctly shows all the missing words in the following sentence.Monetary policy is the management of ________ by changing money _______ for the purpose of adjusting aggregate _____.

Which of the following is NOT a Monetary policy tool available to the FED?

According to the graph, contractionary monetary policy will cause an economy that is initially at full-employment output to go from equilibrium _______ to equilibrium ________ in the short run.

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考试浏览器助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

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The RBA can stimulate the economy by _, all of which shifts the aggregate demand to the _.

Select the option that correctly shows all the missing words in the following sentence.Monetary policy is the management of ____ by changing money _ for the purpose of adjusting aggregate ___.

According to the graph, contractionary monetary policy will cause an economy that is initially at full-employment output to go from equilibrium _ to equilibrium __ in the short run.