Compare two procedures for conducting monetary policy:
Method 1: Maintain a steady money growth of 6 percent per year
Method 2: Maintain a steady inflation rate of 3 percent per year
Be sure to consider whether the methods involve (1) active or passive monetary policy and (2) rules or discretion. Discuss why one method might be preferred over the other.

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The Answer of Compare two procedures for conducting monetary policy:
Method 1: Maintain a steady money growth of 6 percent per year
Method 2: Maintain a steady inflation rate of 3 percent per year
Be sure to consider whether the methods involve (1) active or passive monetary policy and (2) rules or discretion. Discuss why one method might be preferred over the other.

Compare Two Procedures for Conducting Monetary Policy