If a central bank wants to make sure that its policy actions are successful in manipulating interest rates to stabilize an economy around its full-employment level, it should Multiple Choice be prepared to make modest and frequent adjustments after receiving feedback on how its actions affect the economy never announce its intentions, because financial markets will always overreact frequently change its policies to keep financial markets guessing react to a high rate of Inflation but not to an economic boom focus on Inflation and output gap equally

If a central bank wants to make sure that its policy actions are successful in manipulating interest rates to stabilize an economy around its full-employment level, it should Multiple Choice be prepared to make modest and frequent adjustments after receiving feedback on how its actions affect the economy never announce its intentions, because financial markets will always overreact frequently change its policies to keep financial markets guessing react to a high rate of Inflation but not to an economic boom focus on Inflation and output gap equally

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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