One criticism of the Bank of Canada's focus on an inflation control target is that
A)if inflation falls below the target range, a recession will result.
B)if inflation edges above the target range, the Bank decreases aggregate demand and could create a recession.
C)the Bank pays too much attention to unemployment and real GDP growth and not enough to inflation control.
D)it makes setting expectations of inflation difficult.
E)the Bank rarely achieves its target.

Question

Quizplus · Accepted Answer

The criticism is that if inflation exceeds the target range, the Bank of Canada may reduce aggregate demand to control inflation, potentially leading to a recession.

One Criticism of the Bank of Canada's Focus on an Inflation