Which of the Following Is Not an Argument Against Inflation

question 232

Multiple Choice

Which of the following is not an argument against inflation targeting?

• A)Inflation targeting reduces the flexibility of the Fed to pursue other policy goals.
• B)Inflation targeting assumes that the Fed can accurately forecast future inflation rates.
• C)Inflation targeting makes monetary policy ineffective because the targets are publicly announced.
• D)Inflation targeting holds the Fed accountable for an inflation goal,but may make it less likely the Fed will achieve other goals.

---

Definitions:

Price Ceilings

Price controls that outlaw trade at prices above the ceiling.

Intended

Something that is planned or meant to happen in a specific way.

Price Floors

Price controls that outlaw trade at prices below the floor.

Intended

Designed or planned to serve a particular purpose.