- CFA Exams
- CFA Level I Exam
- Topic 2. Economics
- Learning Module 12. Monetary and Fiscal Policy
- Subject 6. Contractionary and Expansionary Monetary Policies and the Neutral Rate
CFA Practice Question
True or False?
A determined central bank can always reflate the economy.
Correct Answer: False
People may decide to hold additional money balances without any change in the interest rate, so that further injections of money into the economy will not serve to further lower interest rates.
User Contributed Comments 1
| User | Comment |
|---|---|
| Antoinepo | Example : Liquidity trap |