Hierarchical mandates can cause a problem that Mervyn King,Governor of the Bank of England,refers to as an "inflation nutter," that can lead to large ________.
A) inflation spikes
B) output fluctuations
C) unemployment rates
D) economic growth

Question

Quizplus · Accepted Answer

Hierarchical mandates focusing too narrowly on inflation control can lead to significant output fluctuations. This is because overly aggressive measures to keep inflation low might ignore or unduly harm other aspects of the economy, such as production and employment, leading to instability in output levels.

Hierarchical Mandates Can Cause a Problem That Mervyn King,Governor of the Bank