A monetary policy rule:
A)occurs when the central bank pursues a formula that determines its actions.
B)brings politics into the monetary policy process.
C)is the same as discretionary monetary policy.
D)is likely to be advocated by Keynesians.

Question

Quizplus · Accepted Answer

A monetary policy rule refers to a specific formula or rule that a central bank follows in determining its monetary policy actions, such as adjusting interest rates or money supply. This approach provides transparency and reduces the discretion of the central bank.

A Monetary Policy Rule