The time inconsistency of policy implies that
a. what policymakers say they will do is generally what they will do, but people don't believe them because of current policy.
b. when people expect that inflation will be low, it is easier for the Fed to increase output by increasing the money supply.
c. people will believe Fed policy will be less inflationary than the Fed claims.
d. what policymakers say they will do is usually not what they do, but people believe them anyway.
b
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Which school of thought would be considered the most laissez-faire?
A. the mainstream view B. the monetarist view C. the self-correction view D. the real business cycle view
The table below shows data for India's economy. Real GDP is measured in millions of rupees
Price level Real GDP supplied in the short run Real GDP demanded a 114 23,501 35,898 b 120 25,355 32,341 c 125 27,670 27,670 d 131 30,366 18,569 e 138 33,164 15,898 If potential GDP in India is ________ million rupees, India is experiencing ________. A) 26,500; an inflationary gap B) 28,500; an above-full-employment gap C) 26,500; a recessionary gap D) 30,000; a potential GDP gap
________ refers to the irregular meetings of creditor governments with debtor nations desiring rescheduling of debts
A) The Paris Club B) IMF "conditionality" C) IBF D) LIBOR
Which of the following is not true of equilibrium price?
A. All consumers can buy all they demand. B. It is determined by the interaction of supply and demand. C. It is set by the government. D. It is also known as the market-clearing price.