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Which of the Following Is False

Question 2

Multiple Choice

Which of the following is false?


A) As data reports are published, policymakers ask themselves if the data is consistent with our economic outlook and desires or if the data signaling that the economy's performance has deviated markedly from what was expected.
B) The problem with assessing data is that many monthly data releases are quite volatile or noisy, possessing a large element of irregular variance that makes the data unreliable as policy indicators.
C) As a result of potentially large month-to-month fluctuations, it is often necessary to have two to three months of data on hand before the underlying cyclical or trend movements in an individual data series become evident.
D) Because data is so unreliable and hard to interpret, the Fed relies much more on forecasts in determining whether or not policy should be changed.

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