which policy allows for a more stable output response to a shock that arises from a change in the demand for goods and services?

Respuesta :

Policy that allows  overall demand through an easing of monetary policy that lowers interest rates.

What interest rates means?

An interest rate can be defined as   the amount a lender charges a borrower and is a percentage of the principal the amount loaned.

Advantages of interest rate includes higher savings returns that can be earned in a savings account .Central banks raise or lower short-term interest rates to ensure stability and liquidity in the economy

They depend upon

  • supply and demand of credit
  • an increase in the demand for money

Hence, Policy that allows  overall demand through an easing of monetary policy that lowers interest rates.

To know more about interest rates from the given link

https://brainly.com/question/20715710

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