There is a correlation between monetary and fiscal policy. Which among the following statements are correct about these correlations?
Codes :
There is a correlation between monetary and fiscal policy. Which among the following statements are correct about these correlations?
Codes :
The correct option is B 2 and 3 only
Statement first is incorrect because monetary policy is responsible for manipulating the supply of money to influence outcomes like economic growth, inflation, exchange rate and employment.
The fiscal policy manipulate level of aggregate demand in the economy to achieve economic objectives of price stability full employment and economic growth.
Though monetary policy is responsible for money supply but this alone is not responsible for change in price level in economy. Fiscal policy here play vital role by influencing demand and supply chain and hence 4th statement incorrect. Statements 2 and 3 are correct.
2 and 3 only
Statement first is incorrect because monetary policy is responsible for manipulating the supply of money to influence outcomes like economic growth, inflation, exchange rate and employment.
The fiscal policy manipulate level of aggregate demand in the economy to achieve economic objectives of price stability full employment and economic growth.
Though monetary policy is responsible for money supply but this alone is not responsible for change in price level in economy. Fiscal policy here play vital role by influencing demand and supply chain and hence 4th statement incorrect. Statements 2 and 3 are correct.
