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Economics · May / June 2019 · Paper 12 · Question 9

2281Monetary policy

In recent years some central banks have reduced interest rates below 1% per year. What is the purpose of this monetary policy?

  1. Ato discourage lending by the commercial banks
  2. Bto encourage investment to stimulate the economy
  3. Cto increase individual savings
  4. Dto reduce inflation

As printed in the paper

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Correct answer: B. to encourage investment to stimulate the economy

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