3 years ago

Contractionary monetary policy on the part of the fed results in

Social Studies

1 answer:

FinnZ [79.3K]3 years ago

3 0

Answer:

Contractionary monetary policy by the Fed results in less inflation, but also, less economic growth.

Contractionary monetary policy mainly consists in raising the interest rate so that lending becomes more expensive. As lending becomes more expensive, less firms borrow, they in turn invest less, and the economy grows less as a result.

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