What Types of Rules for Monetary Policy May Be Sensible

question 19

Essay

What types of rules for monetary policy may be sensible for policymakers to consider? What is the advantage of using rules over discretion? What problems might there be with rules?

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Definitions:

Finance Lease

A type of lease in which the lessor does not select, manufacture, or supply the goods but acquires title to the goods or the right to their possession and use in connection with the terms of the lease.

Consumer Lease

A lease that has a value of $25,000 or less and exists between a lessor who is regularly engaged in the business of leasing or selling and a lessee who leases the goods primarily for a personal, family, or household purpose.

Parol Evidence Rule

A legal principle that prevents parties to a written contract from presenting evidence of prior or contemporaneous agreements that contradict the written agreement.

Lease Contracts

Legal agreements that outline the terms under which one party agrees to rent property owned by another party.