Economics 9708 · AS & A Level · Monetary policy

Monetary policy — practice question

As part of quantitative easing, a central bank buys government securities. What effect is this likely to have on interest rates and the money supply?

  • Ainterest rates decrease, money supply decrease
  • Binterest rates decrease, money supply increase
  • Cinterest rates increase, money supply decrease
  • Dinterest rates increase, money supply increase

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