Anchored Inflationary Expectations Are Beneficial to an Economy Because They

question 32

Multiple Choice

Anchored inflationary expectations are beneficial to an economy because they:

• A)reduce the inside lag of macroeconomic policymaking.
• B)rapidly shift the central bank's monetary policy reaction function
• C)shorten recessions caused by adverse inflation shocks.
• D)eliminate any changes in short-run aggregate supply.

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