Which of the Following Is an Advantage to Monetary Targeting

question 53

Multiple Choice

Which of the following is an advantage to monetary targeting?

• A) There is an immediate signal on the achievement of the target.
• B) It does not rely on a stable money-inflation relationship.
• C) It implies lack of transparency.
• D) It implies smaller output fluctuations.

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Definitions:

Money Supply

The total amount of monetary assets available in an economy at a specific time, including cash, coins, and balances held in checking and savings accounts.

Inflation

The rate at which the general level of prices for goods and services is rising, eroding purchasing power.

Global Economy

An interconnected world economy where goods, services, and financial capital move across national borders, influenced by global events and policies.

Structural Reasons

Fundamental causes or conditions related to the organization or structure of a system, process, or entity.