Which of the following statements about inflation targeting is true?
a. Inflation targeting allows the central bank to achieve multiple goals like low unemployment and economic growth.
b. Inflation targeting has not been adopted by the Fed.
c. A central bank that adopts inflation targeting is intrinsically dependent on fiscal policy.
d. Inflation targeting decreases the perceived uncertainty derived from the central bank's course of action.
e. Inflation targeting increases the uncertainty associated with the central bank's course of action.
d
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The price of reserves that are borrowed from the Federal Reserve is called the
A) discount rate. B) federal funds rate. C) LIBOR. D) prime rate.
If the federal government runs a budget deficit, but the budget deficit as a percent of GDP is less than the growth rate of real output, the
a. national debt will decrease as a share of GDP. b. national debt will remain a constant share of GDP. c. national debt will increase as a share of GDP. d. size of the national debt (in dollar value) will decline.