If a Central Bank Targets Inflation, Then

question 31

Multiple Choice

If a central bank targets inflation, then

• A)a reduction in unemployment will cause only a modest increase in inflation
• B)its policy implies an automatic tradeoff between inflation and unemployment
• C)it must assume that the Phillips curve is fairly flat
• D)it is guided by the belief that large deviations from full-employment are rare
• E)all of the above

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Definitions:

Status Effects

Influences or consequences resulting from an individual's or entity's social or professional position.

Hierarchical Organisations

Organizations structured in a way that positions individuals or groups in layers of authority, ranked above or below each other.

Subordinates

Employees or team members who are ranked lower in the organizational hierarchy and report to supervisors or managers above them.

Efficient Communication

Occurs at minimum cost.