Some People Believe That Monetary Policy Should Be Made by Rule

question 33

Multiple Choice

Some people believe that monetary policy should be made by rule rather than by discretion.One of their beliefs is that

• A)setting a policy rule will limit the abuse of power of policymakers.
• B)policymakers can better influence the political business cycle in their favor when following a policy rule.
• C)a policy rule provides policymakers with the greatest flexibility to manage inflation.
• D)if the Fed was required to follow a low-inflation policy,the economy would face a less favorable short-run trade-off between inflation and unemployment.

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Definitions:

Corporate Cultures

The shared values, beliefs, and practices that characterize an organization and its employees.

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A global automobile manufacturer known for its luxury vehicles, now part of the larger company Daimler AG.

Chrysler

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Success Rate

The proportion or percentage of attempts that lead to a successful outcome or achievement of defined objectives.