Ayushi Asked a Question
August 24, 2020 2:27 pmpts 30 pts
3 73. Which of the following statements best describes Keynes view on working of bank rate as a method of credit control? (1) He says that bank rate does not influence the economy at all (2) He argues that it affects the economy through its influence on long-term interest rates (3) He argues that it affects the economy through its influence o short-term interest rates (4) None of the above
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  • Nidhi taparia Best Answer
    The answer is (2). Keynes believes that bank rate impacts long term interest rate. That is also why Keynes suggested that in the short run, monetary policy is not a very effectiv...
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