Which of the Following Is Not a Disadvantage to Inflation

question 90

Multiple Choice

Which of the following is not a disadvantage to inflation targeting?

• A)There is a delayed signal about achievement of the target.
• B)Inflation targets could impose a rigid rule on policymakers.
• C)There is potential for larger output fluctuations.
• D)There is a lack of transparency.

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Definitions:

Accounting Identity

A fundamental equation that must always hold true, often without regard to time or specific instances, in accounting and economics.

Government Purchases

Expenditures by the government sector for goods and services that are consumed within the current period.

Closed Economy

An economic system that does not interact with other economies in terms of international trade or financial transactions.

Public Saving

The difference between tax revenues and government expenditures, typically representing the amount of surplus funds the government has.