Which of the following can be said to be an example of expansionist monetary policy 1 ...........

Economic Affairs Money Supply and Monetary Policy

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Which of the following can be said to be an example of expansionist monetary policy?

1. Increasing the cash reserve ratio.

2. Lowering the bank rate

3. Increasing the repo rate

Select the correct answer using the codes given below.

1 and 2

1 and 3

2 only

2 and 3

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Explanation:

Expansionary monetary policy- A policy by monetary authorities to expand money supply and boost economic activity, mainly by keeping interest rates low to encourage borrowing by companies, individuals and banks.
Expansionary monetary policy aims to increase aggregate demand and economic growth in the economy. Expansionary monetary policy involves cutting interest rates or increasing the money supply to boost economic activity.