Economic management: Monetary policy

The cash rate and the cash-rate target are different names for the same thing.

• True

• False

Monetary policy is an instrument of economic policy.

• True

• False

The cash rate is a monetary policy tool.

• True

• False

The RBA Board meets to make monetary policy decisions 12 times per year.

• True

• False

A decrease in the cash-rate target is an appropriate response in a recession.

• True

• False

An expansionary monetary policy stance aims to increase the level of economic activity in the Australian economy.

• True

• False

An expansionary fiscal stance would cause interest rates to fall.

• True

• False

Monetary policy has a greater time lag than fiscal policy decisions.

• True

• False

Monetary policy is an instrument for demand management, whereas fiscal policy is more effective in managing supply.

• True

• False

Wealth is a stock and income is a flow.

• True

• False