Changes in inventory investment are ________ for the Fed to use to time changes in monetary policy.

Question

Quizplus · Accepted Answer

Changes in inventory investment are too short-lived for the Fed to use to time changes in monetary policy. Inventory investment can fluctuate rapidly due to changes in consumer demand or production disruptions, but these fluctuations are often temporary and may not reflect broader trends in the economy. As a result, the Fed is more likely to rely on longer-term trends in indicators such as employment, inflation, and economic growth when making decisions about monetary policy.

Changes in Inventory Investment Are ________ for the Fed to Use