Fine tuning represents which of the following?
A)policy makers' attempts to minimize the deviations of actual output from the natural level of output
B)policy makers' attempts to achieve zero inflation
C)policy makers' attempts to minimize fluctuations in interest rates
D)policy makers' attempts to maintain a given rate of growth in the nominal money supply
E) policy makers' attempts to minimize variations in the real exchange rate

Question

Quizplus · Accepted Answer

Fine tuning refers to the policy makers' attempts to adjust monetary and fiscal policies to minimize the deviations of actual output from the natural level of output. The natural level of output refers to the level of output that would be produced by the economy in the absence of any shocks or disturbances. The aim of fine-tuning is to maintain stable economic growth, low levels of inflation, and low unemployment.

Fine Tuning Represents Which of the Following