Why Should Monetary Policy Be Made by Rule Rather Than

question 75

Multiple Choice

Why should monetary policy be made by rule rather than discretion?

• A)because there is a clear consensus among economists about what a good monetary policy rule would be
• B)because rules would eliminate the political business cycle
• C)because rules respond to any random shocks in the economy
• D)because rules create time inconsistency

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Definitions:

Attractive Strategy

An approach or plan crafted to appeal to customers, stakeholders, or partners, aimed at achieving business goals or competitive advantage.

Marketers

Professionals who are involved in the promotion and selling of products or services, including market research, advertising, sales, and distribution, aiming to meet consumer needs and achieve business objectives.

Everyday Low Pricing Strategy

is a pricing model where companies consistently offer products at low prices rather than relying on sales or discounts, aiming to attract price-conscious consumers.

Big Box Stores

Large retail establishments, typically part of a chain, that offer a wide variety of goods under one roof in sizable, warehouse-like spaces.