Potential Weaknesses of Nominal GDP Targeting Include

question 13

Multiple Choice

Potential weaknesses of nominal GDP targeting include

• A)it requires accurate estimates of potential GDP growth,which are not easy to achieve.
• B)it implies that the central bank will respond to slowdowns in the real economy even if inflation is not falling.
• C)real GDP growth that is below potential or inflation that is below the inflation objective will encourage more expansionary monetary policy.
• D)it focuses not only on controlling inflation but also explicitly on stabilizing real GDP.

Know the primary sources of information for client assessments.

Understand the emphasis on strengths and empowerment in assessments.

Differentiate between assessments, diagnoses, and other related terms.

Grasp the concept of reciprocal interactions and their significance in social work assessments.

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Definitions:

Interest Expense

The expenses an entity faces for borrowing funds, encompassing payments for loans, bonds, or credit lines.

Effective Rate

Refers to the real rate of interest earned or paid on an investment, loan, or other financial product, adjusted for the effect of compounding over a given period.

Return Required

The minimum expected rate of return on an investment necessary for an investor to consider it worthwhile.

Interest-Bearing Note

A debt instrument that pays interest to the holder, typically issued at face value and redeemed at maturity for the same amount plus accrued interest.