TRUE, If the fed undertakes expansionary monetary policy, it can return the economy to its original unemployment rate but the inflation rate will be higher.
Monetary policy is the macroeconomic policy set by the central bank. It involves the management of the money supply and interest rates, and is the demand-side economic policy adopted by national governments to achieve macroeconomic goals such as inflation, consumption, growth and liquidity.
Monetary policy refers to the measures taken by a country's central bank to control the money supply in order to stabilize the economy. For example, policymakers manipulate the money supply to increase employment, GDP, and price stability using instruments such as interest rates, reserves, and bonds.
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