Which of the Following Statements About Inflation Targeting Is True

question 6

Multiple Choice

Which of the following statements about inflation targeting is true?

• A)Inflation targeting by the central banks in other countries has not typically lowered inflation.
• B)Inflation targeting would not reduce the flexibility of monetary policy to address other policy goals.
• C)Inflation targeting would not allow the central bank the flexibility to take action against a severe recession.
• D)Inflation targeting would make it easier for households and firms to form accurate expectations of future inflation,improving their planning and the efficiency of the economy.

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Definitions:

Direct Materials Quantity Variance

The difference between the actual quantity of materials used in production and the standard quantity expected to be used, multiplied by the standard cost per unit of material.

Units

Basic quantities or measures used to express the amount, level, or extent of something.

Fixed Factory Overhead Volume Variance

The difference between the budgeted and actual fixed overhead costs, attributable to variations in the volume of production.

Supervisors

Individuals in an organization responsible for overseeing the work of employees and managing their performance.