A monetary offset occurs when:

A. the central bank responds to expansionary fiscal policy with contractionary monetary policy.
B. the central bank responds to expansionary fiscal policy with expansionary monetary policy.
C. the central bank responds to contractionary monetary policy with contractionary fiscal policy.
D. the central bank responds to expansionary monetary policy with contractionary fiscal policy.

Ans: A. the central bank responds to expansionary fiscal policy with contractionary monetary policy.

Economics

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