Notice: Payments for answers will end 4/10/2017. Click for more info.
You have new items in your feed. Click to view.
Question and answer
Q: Currently, what indictors are evident that there is too much or too little money within the economy? How is monetary policy aiming to adjust this?
A: Inflation, fiscal, and monetary policies are good indications. If inflation is high, the money supply in circulating with greater injections than leakages. [ Government policies of interest rates and taxation (monetary and fiscal policy) are good indications of attempted government intervention to control the amount of money available on the market/ floating. ]
Get an answer
Original conversation
User: Currently, what indictors are evident that there is too much or too little money within the economy? How is monetary policy aiming to adjust this?

Weegy: Inflation, fiscal, and monetary policies are good indications. If inflation is high, the money supply in circulating with greater injections than leakages. [ Government policies of interest rates and taxation (monetary and fiscal policy) are good indications of attempted government intervention to control the amount of money available on the market/ floating. ]



User: How does monetary policy aim to avoid inflation?

Weegy: Monetary policy is the control of interest rates. [ The market psychology states that high interest rates will encourage savings rather than spending as one can earn more by depositing money in the bank and it is more expensive to take out loans in comparison to low interest rates. When inflation is high, interest rates will be raised to curb consumption. Inflation is usually the result of aggregate demand surpassing aggregate supply. With the limited amount of resources available, the supply for all goods and services are limited. When AD supasses AS, the price increases rapidly, which leads to high inflation. High interest rates discourage spending as taking out loans are more costly. This will lower the aggregate demand and eventually return the AD and AS to the equilibrium point or the comfort zone. ]



Question
Asked 6/27/2012 8:48:04 AM
0 Answers/Comments
New answers
Rating

There are no new answers.

Comments

There are no comments.

Add an answer or comment
Log in or sign up first.
26,395,355 questions answered
Weegy Stuff
S
P
P
L
P
P
P
Points 104 [Total 1840] Ratings 3 Comments 74 Invitations 0 Online
S
Points 57 [Total 68] Ratings 4 Comments 17 Invitations 0 Online
S
Points 30 [Total 30] Ratings 3 Comments 0 Invitations 0 Offline
S
Points 16 [Total 16] Ratings 0 Comments 6 Invitations 1 Offline
S
L
Points 15 [Total 112] Ratings 0 Comments 15 Invitations 0 Offline
S
Points 10 [Total 10] Ratings 1 Comments 0 Invitations 0 Offline
S
Points 10 [Total 10] Ratings 1 Comments 0 Invitations 0 Offline
S
Points 10 [Total 10] Ratings 1 Comments 0 Invitations 0 Offline
S
Points 10 [Total 10] Ratings 1 Comments 0 Invitations 0 Offline
S
Points 5 [Total 5] Ratings 0 Comments 5 Invitations 0 Offline
* Excludes moderators and previous
winners (Include)
Home | Contact | Blog | About | Terms | Privacy | © Purple Inc.