Monetary policy impacts GDP mainly through its effect on... Select one: m - 4- a. government spending. 0 b. investment. 'A: c. consumption. --A d. net exports. A: e. taxes. Clear my choice A liquidity trap refers to a situation in which... Select one: a. the government prints money to pay its bills. A b. the Fed pursues a contractionary monetary policy. 0 c. the Fed is unable to further reduce interest rates. A d. banks are eager to make new loans. e. the federal funds rate is extraordinarily high