Which of the Following Is a Problem with Inflation Targeting

Multiple Choice

Which of the following is a problem with inflation targeting?

A) The Fed cannot simultaneously target the inflation rate and move the economy to its potential output.
B) The amount of time it takes to recognize that inflation has escalated makes it difficult to target inflation in a timely manner.
C) Targeting inflation in the U.S.has repercussions in global financial markets that could further aggravate inflation in the domestic economy.
D) Since the inflation rate is not known until after the fact, the Fed would be responding to past economic conditions with policies that have an uncertain length of impact lag.