Which one of the following is a correct statement regarding monetary policy?
The Monetary Policy Committee of the Bank of England is responsible for setting national tax rates.
Monetary policy measures, such as changing interest rates, can affect both the level of aggregate demand and the exchange rate.
Monetary policy is exclusively used to restrict economic activity and control inflation.
The UK Treasury is solely responsible for adjusting the bank rate on a monthly basis.
176 exam-style questions on AQA A Level Economics 2.4 Financial markets and monetary policy (A-level only), covering 2.4.1 The structure of financial markets and financial assets, 2.4.2 Commercial banks and investment banks, 2.4.3 Central banks and monetary policy, and 2.4.4 The regulation of the financial system. Each one has a worked solution and a mark scheme showing where the marks go.