Multiple Choice
Which of the following is not a valid argument for policy rules?
A) rules are more flexible than discretion for dealing with unpredictable shocks
B) well-functioning automatic stabilizers generally operate according to rules
C) private behavior can offset the effects of discretionary policy
D) time inconsistency can make short run and long run goals incompatible
E) discretionary policy can be destabilizing
Correct Answer:
Verified
Correct Answer:
Verified
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