A sudden increase in food and energy prices... O a. Makes inflation targeting harder because these are closely related to excess demand. O b. Would not cause an immediate policy response because it is not a part of core inflation. Oc. Makes inflation targeting easier because it makes these problems less relevant. O d. Would be offset by a decline in the Canadian dollar, making them irrelevant. O e. Would cause an immediate policy response to avoid the opening of an inflationary е. gap.
A sudden increase in food and energy prices... O a. Makes inflation targeting harder because these are closely related to excess demand. O b. Would not cause an immediate policy response because it is not a part of core inflation. Oc. Makes inflation targeting easier because it makes these problems less relevant. O d. Would be offset by a decline in the Canadian dollar, making them irrelevant. O e. Would cause an immediate policy response to avoid the opening of an inflationary е. gap.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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