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MC Question 1

Which of the following statements is/are correct?

(1) Monetary policy seeks to influence aggregate demand by increasing or decreasing the money raised through taxation

(2) When governments adopt a floating exchange rate system, the exchange rate is an equilibrium between demand and supply in the foreign exchange market

(3) Fiscal policy seeks to influence the economy and economic growth by increasing or decreasing interest rates

A. 2 only
B. 1 and 2 only
C. 1 and 3 only
D. 1, 2 and 3