What are the goals when a government uses expansionary monetary policy? Check all that apply.





increasing its money supply to boost the economy


decreasing its money supply to slow the economy


increasing its money supply to speed business expansion


decreasing its money supply to curb business expansion


decreasing its interest rates to increase investment spending

Respuesta :

The correct answers to this question are the options 1, 3, and 5.


An expansionary monetary policy is a policy of a central bank in which the total supply of money is increased more rapidly than the usual in the economy. The money supply is increased and the interest rates are decreased so that the aggregate demand is increased and helps the businesses in its expansion. It also helps in combating unemployment. Also, the GDP increases which is indicated as a positive sign of growth.

The goals of a government when they use expansionary monetary policy are:

  • Increasing its money supply to boost the economy.
  • Increasing its money supply to speed business expansion
  • Decreasing its interest rates to increase investment spending.

What is a Government?

A government is an organized system of individuals or groups vested with the power to govern a particular people within a particular territory. The government creates policies that would favor the nation and the people.

The government has a goal when they use expansionary monetary policies and these goals are achieved by increasing its money supply to boost the economy. They also increase the money supply in the system for business expansion and then decrease its interest rate so as to increase investment.

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