When Would Inflation Targeting Using Interest Rates Lead to a Recession

question 6

Multiple Choice

When would inflation targeting using interest rates lead to a recession in an economy?

• A) When the central bank publicizes its target goal for the inflation rate.
• B) When inflation is inversely linked to employment.
• C) When the target rate of inflation is very high.
• D) When the inflation has been caused by a reduction in aggregate supply.

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