Monetary stimulus will fail if Multiple Choice Banks lend too much money Short-term interest rates are affected but long-term interest rates are not. Consumers spend too much money, creating a...

Monetary stimulus will fail if Multiple Choice

Banks lend too much money

Short-term interest rates are affected but long-term interest rates are not.

Consumers spend too much money, creating a shortage of money

Lower interest rates cause households to not refinance mortgages and not apply for new consumer loans