Question

When a central bank influences the growth of the money supply, it is carrying out _____.

monetary policy
fiscal policy

Answer 1

The right answer would be monetary policy.

Answer 2

The correct answer is Monetary Policy. Monteray policies are made by institutions like central banks with the goal of adjusting or fighting inflation and deflation rates. Fiscal policies would be policies about public spending or about imports and exports and would be made by the congress and not by the central bank.