All of the Following Arguments Are Made Against Inflation Targeting

question 87

Multiple Choice

All of the following arguments are made against inflation targeting EXCEPT

• A)rigid numerical targets would diminish the flexibility of monetary policy.
• B)the Fed would need to depend on future forecasts of inflation since monetary policy acts with a lag.
• C)the Fed has little influence on inflation.
• D)Holding the Fed accountable for low inflation may make it difficult for elected officials to monitor whether the Fed is supporting good overall economic policy.

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Definitions:

Genetic Factors

Aspects of an organism's genetic makeup that influence its physical and behavioral traits.

Dizygotic Twins

Also known as fraternal twins, are siblings born at the same time but developed from separate eggs fertilized by separate sperm.

Phenotype

The observable characteristics or traits of an organism, resulting from the interaction of its genotype with the environment.

Genotype

The genetic constitution of an individual organism, often contrasting with its physically expressed traits.