Multiple Choice
When a central bank engages in inflation targeting, then
A) interest rate stability will automatically result
B) interest rates need to be raised as soon as the output gap starts to shrink
C) the Taylor rule can still be used as a guide as long as the output coefficient is set to zero
D) the Taylor rule can still be used as a guide as long as the output coefficient has a lot of weight
E) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
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Q43: Which of the following is NOT a
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