Which of the following is not an advantage of inflation targeting?
A)reduction of the time-inconsistency problem
B)increased monetary policy transparency
C)There is an immediate signal on the achievement of the target.
D)consistency with democratic principles

Question

Quizplus · Accepted Answer

This statement is not entirely accurate as there may be a lag between the implementation of monetary policy and the actual impact on inflation, which means that there may not be an immediate signal on the achievement of the target. A and B are advantages of inflation targeting, while D is not directly related to inflation targeting.

Which of the Following Is Not an Advantage of Inflation