Monetary Policy is when an important bank controls the whole country’s money.
A JOB INTERVIEW
Hi Joe! My name is Paul! As your potential future boss, I want to make sure you know about Monetary Policy. What is it?
Great Answer, Joe!
That's easy! They control the buying and selling of the money in the country, set a rate that banks have to follow when letting other banks borrow their money, and control how much money has to stay in a bank.
What are 3 things monetary policy does?
Money will not be worth as much. The idea of money changing value is called inflation.
Also, the government wants to stabilize prices. They don't want the prices of things to constantly change.
What will happen if the government grows too fast and spends too much money?
It stabilizes GDP, which is all of the money that a country makes and spends. It also tries to makes sure people have jobs and have enough money to buy all they need.
What else does monetary policy control?
They stabilize job cycles so the worth of money is always worth the same. Also, companies hire people to create as much as they can using all the available materials. They also want people to have money and use their time to create as much as they can.