Adhering to a Monetary Rule,according to Some Economists,is Superior to Discretionary

question 56

Multiple Choice

Adhering to a monetary rule,according to some economists,is superior to discretionary attempts to "lean against the wind" because

• A) it would virtually eliminate business fluctuations.
• B) the success of monetary policy since World War II has demonstrated the effectiveness of such a rule.
• C) the Fed would be free to concentrate on manipulating interest rates.
• D) the lag between policy actions and their economic impact is highly variable and unpredictable.
• E) it would allow for more successful fine-tuning of the economy.

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Definitions:

Sensory Fibers

Nerve fibers that transmit sensory information from the peripheral sense organs to the central nervous system.

Motor Fibers

Motor fibers are nerve fibers that transmit impulses from the nervous system to muscles, causing them to contract and produce movement.

Sensory Root

The part of a spinal nerve that carries sensory information from the peripheral body parts back to the spinal cord.

Dorsal Root

The part of a spinal nerve that carries sensory neural information to the spinal cord from the peripheral organs.