Describe inflation targeting rule as a monetary policy. What are its benefits?
What will be an ideal response?
Inflation targeting requires that the nation's central bank set and then make public an explicit target for the inflation rate. Then the central bank must explain how its policy actions are designed to achieve its inflation goal. Inflation targeting has the major advantage of firmly setting the public's expected inflation rate. It also serves to keep the actual inflation rate because central banks are loathe to set a target level for inflation.
You might also like to view...
In the early 1800s, many state legislatures began to pass general incorporation laws, which
A) made it harder for firms to organize as corporations. B) allowed sole proprietorships and partnerships to issue stock. C) allowed firms to more easily be organized as corporations. D) granted sole proprietorships and partnerships limited personal liability.
Tobacco could not be grown in England. It could only be produced in the colonial South
Indicate whether the statement is true or false