Which of the following is consistent with a steeply upwardly sloping yield curve? A) | Monetary policy is expansive and fiscal policy is expansive. |
| | B) | Monetary policy is restrictive and fiscal policy is restrictive. |
| | C) | Monetary policy is restrictive while fiscal policy is expansive. |
| | D) | Monetary policy is expansive while fiscal policy is restrictive. |
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Answer and Explanation
When both fiscal and monetary policies are expansive, the yield curve is sharply, upwardly sloping (i.e., short-term rates are lower than long-term rates), and the economy is likely to expand in the future.
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发表于 2008-9-12 15:10
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