One Criticism of Monetary Policy Based on a Predetermined Steady

question 178

Multiple Choice

One criticism of monetary policy based on a predetermined steady growth rate in money supply is that

• A) wages and prices are sufficiently flexible to allow the economy to restore the natural level of Real GDP on its own.
• B) the total lag in monetary policy may be too long to allow for effective monetary policy.
• C) changes in velocity,if not accounted for,can then be a source of price instability.
• D) a and b
• E) all of the above

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