The Federal Reserve Will Keep the Inflation Rate Constant, Regardless

question 57

Multiple Choice

The Federal Reserve will keep the inflation rate constant, regardless of evolving economic conditions, if it is using

• A) Friedman's monetary rule.
• B) inflation targeting.
• C) monetary targeting.
• D) the Taylor rule.

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Definitions:

Behavioral Observations

The method of studying subjects' actions in their natural settings without intervention.

Internal Processes

Internal processes involve the cognitive, psychological, and physiological operations that underlie an individual's mental and emotional functioning.

Behaviorists

Behaviorists focus on observable behaviors and the ways they're learned, downplaying the role of internal thoughts and feelings.

Gestalt Psychologists

Psychologists who believe that human perception and behavior should be understood as organized wholes, rather than the sum of their parts.