The monetary policy that the Central Bank is using to address the downturn in the economy is the reduction of the reserve requirement from 17% t 14%.

<h3>What is monetary policy?</h3>

It should be noted that the monetary policy is the set of actions to control money supply in the economy.

The macroeconomic issues resulting from the pandemic on Trinidad and Tobago are that there are less money in circulation and there's a reduction in the standard of living.

The reduction of the reserve requirement will impact the money supply as it will lead to more money in circulation.

<u>Complete question:</u>

1. What form of monetary policy can the Central Bank use to address the downturn in the economy resulting from the pandemic?

2. Identity and explain two macroeconomic issues resulting from the pandemic on Trinidad and Tobago.

3. Identify how the reserve requirement will impact the money supply.

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2 years ago