2. Monetary Policy Rule A basic monetary policy rule we discussed is that when inflation changes unexpectedly the central bank should adjust its policy rate in the same direction and more than the change in inflation. Why is this thought of as an essential move by the central bank?

2. Monetary Policy Rule A basic monetary policy rule we discussed is that when inflation changes unexpectedly the central bank should adjust its policy rate in the same direction and more than the change in inflation. Why is this thought of as an essential move by the central bank?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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