Economics · Monetary Policy
In the IS-LM framework, when the demand for money is infinitely interest-elastic (liquidity trap), the effectiveness of an expansionary monetary policy on output is:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1Unpredictable
- 2Nil (Zero effectiveness)✓
- 3Moderate
- 4Maximum / Highest
Correct answer
Nil (Zero effectiveness)
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Economics?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice Monetary Policy MCQs →Want more practice questions on Monetary Policy?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Economics · Monetary Policy