Question

Active monetary policy a. is when central banks take orders from the ruling party on how to conduct monetary policy. b. is when central banks purposefully choose to only stabilize money and price levels through monetary policy. c. has a real effect on the economy in the long run. d. is when central banks only use fiscal policy to try to influence the economy. e. is the strategic use of monetary policy to counteract macroeconomic expansions and contractions. 1

Answer 1

Answer: D

Active monetary policy is when central banks only use fiscal policy to try to influence the economy.

Step-by-step explanation:

the active policy is defined as actions by the Fed or by the government that is done in response to economic conditions. That is, the Fed or the government chooses to respond to something in the economy by undertaking a specific policy. This is also called a discretionary policy.

Active policy means the central bank can act, or choose not to act, based on its assessment of the nation's economy.