Question

Which one of the following is the basic objective of monetary policy?

a. to control deficit of the budget
b. to control deficit in the balance of payment
c. to control cost and availability of money
d. to control public expenditure

Answer 1

Answer: C

Step-by-step explanation:

The basic objective of monetary policy is to control the cost and availability of money in an economy.

This is typically done by the central bank of a country, which uses a variety of tools and instruments to manage the supply of money and the level of interest rates in the economy.

The main goal of monetary policy is to promote economic growth and stability, and to help achieve this goal, central banks may use monetary policy to influence the rate of inflation, the level of employment, and other economic indicators.

Monetary policy is not used to control the deficit of the budget or the balance of payment, or to control public expenditure.