Assuming endogenous money and that the Reserve Bank conducts monetary policy by means of a target cash rate, an expansionary monetary policy would imply thatGroup of answer choicesboth the demand for money and the supply of money increases and the yield curve shifts upwardsthe yields curve shifts, the general level of interest rates falls and the demand and supply of money both increasethe general level of interest rates falls because the supply of money increases relative to the demand for moneythe supply of money increases because of a change in the general level of interest rates and the increase in the supply of money causes an increase in the demand for money.

The general level of interest rates falls because the supply of money increases relative to the demand for money. Here's the step by step explanation:

1. The Reserve Bank decides to implement an expansionary monetary policy. This means they want to increase the supply of money in the economy.

2. To do this, they lower the target cash rate. This is the interest rate that banks charge each other for overnight loans.

3. Lowering the target cash rate makes borrowing cheaper. This encourages banks to borrow more from each other, increasing the amount of money they have to lend to consumers and businesses.

4. As banks increase their lending, the supply of money in the economy increases.

5. With more money available, the cost of borrowing (i.e., the interest rate) decreases. This is because when supply is greater than demand, prices fall. In this case, the 'price' is the interest rate.

6. The fall in interest rates is intended to stimulate economic activity by making it cheaper for businesses and consumers to borrow and spend. This increases the demand for money.

7. However, the increase in the supply of money is greater than the increase in demand, so the overall effect is that the general level of interest rates falls.