Which of the Following Is Not an Appropriate Policy for a Central

question 237

Multiple Choice

Which of the following is not an appropriate policy for a central bank to follow if the economy is plagued with deflation?

• A)increasing the target interest rate on overnight loans
• B)using expansionary monetary policy to drive down interest rates
• C)consistently pursuing policy to promote the credibility of the central bank
• D)explicitly and credibly targeting inflation

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Definitions:

Contracts

Legally binding agreements between two or more parties that specify and regulate the terms of an engagement, service, or transaction.

Positive Discipline

A disciplinary approach focusing on constructive feedback and encouraging employees to learn from their mistakes without fear of punitive actions.

Management

The process of planning, organizing, leading, and controlling resources within an organization to achieve its goals efficiently and effectively.