The time-inconsistency problem is likely to arise in Cadmia if _____
a. attempts are made to coordinate monetary policy with fiscal policy
b. there is a lag between the announcement of a monetary policy and its implementation
c. policy makers initially aim to keep the price level stable but do not follow through as promised
d. policy makers do not allow enough time for a new policy to take effect
e. there is a deep conflict among monetary policy makers
c
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A government tax rebate of $1,000 would ________ your disposable income by ________
A) decrease; $1,000 B) increase; less than $1,000 C) decrease; less than $1,000 D) increase; $1,000
Someone who is risk-averse has
A) diminishing marginal utility of wealth. B) constant marginal utility of wealth. C) increasing marginal utility of wealth. D) less marginal utility of wealth than someone who is risk-neutral.