What Are the Problems of Discretionary Monetary Policy? How Can

question 10

Essay

What are the problems of discretionary monetary policy? How can we avoid these problems?

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Definitions:

Gini Index

A measure of income inequality. Its value ranges from 0 (which means that every household earns exactly the same amount of money) to 1 (which means that all income is earned by a single household).

Household

A household consists of one or more people who live in the same dwelling and share living accommodations, which could include families, roommates, or individuals living alone.

National Income

The total monetary value of all goods and services produced over a specific time period within a country’s borders, used as an indicator of economic health.

India

A country in South Asia, known for its diverse cultures, languages, religions, and history, and is the world's largest democracy.