Time Lags in Monetary Policy Can Cause

question 32

Multiple Choice

Time lags in monetary policy can cause

• A)short- term monetary policy to work more effectively than long- term targeting.
• B)difficulty in the timing of appropriate policy and can even lead to destabilization.
• C)an expansionary policy to have too little an effect because it takes much longer to work than was expected by policymakers.
• D)monetary policy to work more slowly and more smoothly than was initially predicted by economists.
• E)monetary expansions to work very quickly but cause monetary contractions to work very slowly.

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Definitions:

Canceling Order

An instruction to cancel a previously issued order before it is executed, commonly used in trading and procurement.

Express Repudiation

The clear and unequivocal refusal to perform one's obligations under a contract.

Anticipatory Breach

Occurs when one party to a contract indicates, either through their actions or words, that they will not fulfill their contractual obligations, allowing the other party to seek remedies before the breach actually occurs.

Performance Date

The specified day by which a contractual agreement, task, or duty must be completed.