Monetary policy manages the money supply in an economy through credit control measures adopted by central banks to achieve goals like full employment, price stability, and economic growth. Central banks use quantitative instruments like changing bank rates, conducting open market operations, and adjusting cash reserve ratios, as well as qualitative instruments such as credit rationing, regulating consumer credit, direct action, and moral suasion. However, monetary policy faces limitations in less developed countries due to factors including large non-monetized sectors, undeveloped money and capital markets, and money not deposited in banks.