Many economists believe the central banks were in large part responsible for bringing about the Great Moderation,especially by the focus of the Bank of Canada and the Federal Reserve on

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Many economists believe that the central banks, particularly the Bank of Canada and the Federal Reserve, were responsible for bringing about the Great Moderation by focusing on low and stable inflation through monetary policy. By keeping inflation in check, the central banks helped to stabilize the economy and reduce fluctuations in output and employment. Therefore, B (low and stable inflation) is the best choice. C (discretionary rules) and D (targeting unemployment) are not generally considered to be key factors in bringing about the Great Moderation.

Many Economists Believe the Central Banks Were in Large Part