Economics of Money, Banking and Financial Markets, The, Business School Edition (5th Edition) (What's New in Economics)
5th Edition
ISBN: 9780134734200
Author: Frederic S. Mishkin
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Question
Chapter 24, Problem 5Q
To determine
To Explain:
The reason why divine coincidence simplifies the task of policymakers.
Concept introduction:
Divine Coincidence: Olivier Blanchard and Jordi Galí in 2005 defined the concept of divine coincidence. It means that there is no trade-off between the stabilization of inflation and the stabilization of the output gap for central banks. It signifies the absence of real imperfections like real wage rigidities. It implies that output gap can be brought to zero by controlling inflation, and there is no need to have separate targets for both.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionChapter 24 Solutions
Economics of Money, Banking and Financial Markets, The, Business School Edition (5th Edition) (What's New in Economics)
Ch. 24 - Prob. 1LOCh. 24 - Prob. 2LOCh. 24 - Prob. 3LOCh. 24 - Prob. 4LOCh. 24 - Prob. 5LOCh. 24 - Prob. 1QCh. 24 - Prob. 2QCh. 24 - Prob. 3QCh. 24 - Prob. 4QCh. 24 - Prob. 5Q
Ch. 24 - Prob. 6QCh. 24 - Prob. 7QCh. 24 - Prob. 8QCh. 24 - Prob. 9QCh. 24 - Prob. 10QCh. 24 - Prob. 11QCh. 24 - Prob. 12QCh. 24 - Prob. 13QCh. 24 - Prob. 14QCh. 24 - Prob. 15QCh. 24 - Prob. 16QCh. 24 - Prob. 17QCh. 24 - Prob. 18QCh. 24 - Prob. 19QCh. 24 - Prob. 20QCh. 24 - Prob. 21QCh. 24 - Prob. 22QCh. 24 - Prob. 23QCh. 24 - Prob. 24QCh. 24 - Prob. 25APCh. 24 - Prob. 26APCh. 24 - Prob. 27APCh. 24 - Prob. 28APCh. 24 - Prob. 29APCh. 24 - Prob. 30APCh. 24 - Prob. 1DAPCh. 24 - Prob. 2DAPCh. 24 - Prob. 1WECh. 24 - Prob. 2WE
Knowledge Booster
Recommended textbooks for you
- Principles of Economics (12th Edition)EconomicsISBN:9780134078779Author:Karl E. Case, Ray C. Fair, Sharon E. OsterPublisher:PEARSONEngineering Economy (17th Edition)EconomicsISBN:9780134870069Author:William G. Sullivan, Elin M. Wicks, C. Patrick KoellingPublisher:PEARSON
- Principles of Economics (MindTap Course List)EconomicsISBN:9781305585126Author:N. Gregory MankiwPublisher:Cengage LearningManagerial Economics: A Problem Solving ApproachEconomicsISBN:9781337106665Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike ShorPublisher:Cengage LearningManagerial Economics & Business Strategy (Mcgraw-...EconomicsISBN:9781259290619Author:Michael Baye, Jeff PrincePublisher:McGraw-Hill Education
Principles of Economics (12th Edition)
Economics
ISBN:9780134078779
Author:Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:9780134870069
Author:William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:9781305585126
Author:N. Gregory Mankiw
Publisher:Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-...
Economics
ISBN:9781259290619
Author:Michael Baye, Jeff Prince
Publisher:McGraw-Hill Education