Which of the Following Is a Disadvantage of Inflation Targeting

question 22

Multiple Choice

Which of the following is a disadvantage of inflation targeting?

• A) There is simplicity and clarity of the target.
• B) Inflation targeting does not rely on a stable money-inflation relationship.
• C) There is a delayed signal on the achievement of the target.
• D) Inflation targeting reduces the effects of inflation shocks.

---

Definitions:

Reframing

The process of changing the perspective or context of a situation to view it in a new light.

Thrust, Tone

The main direction, force, or emphasis of a discourse or negotiation, along with the mood or attitude conveyed through it.

Dynamic Process

This refers to a constantly evolving and changing procedure or series of actions, highlighting the fluid nature of the concept it describes.

Availability Of Information Bias

The cognitive bias that involves over-relying on the information that is most readily available, rather than considering all relevant data.