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7 October, 23:09

Using the supply and demand for loanable funds model, explain why the central bank may aggressively expand the monetary base.

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  1. 7 October, 23:33
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    Answer: This means that there may remain room for an increase in the monetary base to. Finally, we discuss reasons why the expansion of the monetary base at ... A central bank can lower longer-term interest rates even when. small, why does the Bank not aggressively try the "unconventional" policy of purchasing some specific.

    Explanation: Central banks affect the quantity of money in circulation by buying or selling government securities through the process known as open market operations (OMO). When a central bank is looking to increase the quantity of money in circulation, it purchases government securities from commercial banks and institutions.
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