The Advantage of an Explicit Inflation Target Is That It

question 68

Multiple Choice

The advantage of an explicit inflation target is that it:

• A) helps anchor inflation expectations.
• B) allows banks to set interest rates.
• C) stabilizes employment.
• D) raises the marginal product of capital.
• E) completely eradicates discretionary monetary policy.

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Definitions:

Journal Entry

A record of a transaction in the accounting journal that details which accounts are affected and in what way.

Payment Promise

A commitment by one party to pay another, often documented in a formal agreement or note.

Common Stock

A type of security that represents ownership in a corporation, entitling holders to a share of the company’s profits through dividends and/or capital appreciation.

Photography Equipment

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