In terms of economic growth, the central bank would like to:

Question

Quizplus · Accepted Answer

The central bank's goal is to keep the economy close to its potential or sustainable rate of growth, which is the rate at which the economy can grow without creating inflationary pressures or causing a recession. This is typically the most stable and sustainable rate of growth for the economy in the long run. Maximizing growth (option A) can lead to inflationary pressures and eventual economic instability, while trying to balance every recession with a boom (option D) could lead to unsustainable growth and economic bubbles that eventually burst. Keeping the growth rate averaging zero (option B) would result in a stagnant economy with no growth or opportunities for prosperity.

In Terms of Economic Growth, the Central Bank Would Like