When Conducting Monetary Policy, the Fed Should Not Just Look

When conducting monetary policy, the Fed should not just look at the total amount of money but also at the total amount of credit, since

A) the link between money and nominal GDP is insignificant
B) if not enough credit is available investment will be reduced, affecting GDP negatively
C) banks can ration credit, affecting the impact of monetary policy
D) all of the above
E) only B) and C)

Correct Answer:

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