💰Expansionary monetary policy is implemented during a recessionary gap to increase aggregate demand and stimulate economic growth.
🏦The central bank uses open market operations, such as purchasing government debt securities, to introduce money into the economy.
📉Expansionary monetary policy aims to lower interest rates, easing the cost of borrowing and stimulating investment.
🌱This policy increases funds available for lending, which stimulates economic growth and helps bring the economy back to full employment equilibrium.
💵Quantitative easing is another method used in expansionary monetary policy when interest rates are already low, aiming to increase the number of loans.