Which of the following is a disadvantage to monetary targeting?
A)It relies on a stable money-inflation relationship.
B)There is a delayed signal about the achievement of a target.
C)It implies larger output fluctuations.
D)It implies a lack of transparency.

Question

Quizplus · Accepted Answer

Monetary targeting relies on a stable relationship between money supply and inflation, which can be a disadvantage if this relationship is unstable or changes over time.

Which of the Following Is a Disadvantage to Monetary Targeting