If Desired Investment Spending Is Relatively Sensitive to Changes in Interest

Multiple Choice

If desired investment spending is relatively sensitive to changes in interest rates,then monetary policy could be very useful because it would

A) be very effective in reducing expenditure during inflationary periods and very effective in expanding expenditure during recessionary periods.
B) be very effective in reducing expenditure during inflationary periods and ineffective in expanding expenditure during recessionary periods.
C) be very ineffective in reducing expenditure during inflationary periods and very effective in expanding expenditure during recessionary periods.
D) be very ineffective in reducing expenditure during inflationary periods and very ineffective in expanding expenditure during recessionary periods.
E) be somewhat effective in reducing expenditure during inflationary periods and very ineffective in expanding expenditure during recessionary periods.