Essay
Compare two procedures for conducting monetary policy:
Method 1: Maintain a steady money growth of 6 percent per annum, and
Method 2: Maintain a steady inflation rate of 3 percent per annum.
Be sure to consider whether the methods involve: (1) active or passive monetary policy and (2) rules or discretion. Discuss why one method might be preferred over the other.
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Both methods 1 and 2 are monetary policy...View Answer
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