If a central bank implements an expansionary monetary policy by lowering interest rates, what is likely to happen to unemployment in the short run?

When a central bank cuts interest rates, borrowing becomes cheaper, so households and firms are more likely to take loans and spend on goods, services, and new projects. This increased demand for products pushes companies to hire more workers to keep up, so the number of jobs rises. As a result, the unemployment rate falls in the short run because more people find work. For example, if a bank lowers rates from 5 % to 2 %, a factory might expand production and hire ten new workers, reducing local unemployment. Thus, expansionary monetary policy usually lowers unemployment in the short term.