If the Fed follows a policy of targeting the inflation rate:
A. its credibility will be lowered.
B. the natural rate of unemployment will rise.
C. it will likely face fewer political pressures.
D. the automatic stabilizers will not work.
Answer:C
If the Fed follows a policy of targeting the inflation rate:
A. its credibility will be lowered. B. the natural rate of unemployment will rise. C. it will likely face fewer political pressures. D. the automatic stabilizers will not work.