Which of the Following Accurately Describes the Fed's Inflation Target

question 44

Multiple Choice

Which of the following accurately describes the Fed's inflation target?

• A) It is implicit rather than explicit.
• B) It seeks to maintain an average inflation rate of 2% per year.
• C) It seeks to keep inflation at 2% all the time.
• D) Its goal is to achieve zero inflation.

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Definitions:

Wealthy People

Individuals possessing a significant amount of capital, assets, or resources, well above the financial average of the general population.

Ill-Gotten Gains

Profits or benefits acquired dishonestly or through unethical means.

Just-World Phenomenon

A cognitive bias that leads individuals to believe that the world is inherently fair, leading them to rationalize an unwarranted, good or bad situation as deserving.

Natural Disaster

Severe, catastrophic events resulting from natural processes of the Earth, such as earthquakes, floods, hurricanes, and volcanic eruptions.