Question

Monetary policy increases the inflation rate is known as

Answer 1

Expansionary policy occurs when a monetary authority uses its tools to stimulate the economy. An expansionary policy maintains short-term interest rates at a lower than usual rate or increases the total supply of money in the economy more rapidly than usual. ... This slows short-term economic growth and lessens inflation.

thanks..

Answer 2

Expansionary monetary policy increases the growth of the economy, while contractionary policy slows economic growth. The three objectives of monetary policy are controlling inflation, managing employment levels, and maintaining long-term interest rates.