Inflation targeting does all of the following except:
A. communicate policymakers' objectives clearly and openly.
B. increase policymakers' accountability.
C. increase policymakers' credibility.
D. hinder economic growth.
Answer: D
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Which of the following exchange rate systems is in the right order, from MOST control to LEAST control?
a. floating, fixed, managed float b. fixed, floating, managed float c. managed float, floating, fixed d. fixed, managed float, floating
Suppose there are two firms, Boors and Cudweiser, each selling nonalcoholic beer. Suppose Boors and Cudweiser are not viewed as perfect substitutes but rather demand for Boors is QB = 5000 ? 1000PB + 100PC and demand for Cudweiser is QC = 3000 ? 1500PC + 100PB. For simplicity, assume zero marginal costs. Which is the more preferred beer?
a. Boor's b. Cudweiser c. they are equally preferred d. neither are preferred