Why Is Deflation, Combined with a Recessionary Gap, and a Zero

question 86

Essay

Why is deflation, combined with a recessionary gap, and a zero nominal interest rate a monetary policymaker's worst nightmare?

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Definitions:

Quantification

The process of expressing or measuring something in terms of numbers or units.

Mnemonic CLIENTS

A memory aid used to encapsulate information for easier recall, specific content represented by "CLIENTS" is not defined universally.

Impairment

A reduction in the ability or function in a specific area, often as a result of a condition or injury.

Stressor

An event, situation, or stimulus that causes stress or tension in an individual.