Which Statement About Monetary Rules Is Correct

question 278

Multiple Choice

Which statement about monetary rules is correct?

• A) Monetary rules prevent policymakers from making things worse when there is a large or persistent shock to the economy.
• B) Monetary rules assume the economy is inherently stable.
• C) Advocates of monetary rules advise increasing the money supply during recessions and decreasing the money supply to fight inflation.
• D) Monetary rules require frequent changes in the money supply.

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