The key to the assignment rule is that one powerful government policy tool can be used to achieve both external balance and internal balance.

Question

Quizplus · Accepted Answer

The assignment rule suggests that each policy tool should be dedicated to a specific target, implying that one tool should be used for achieving external balance (e.g., exchange rate policy) and another for internal balance (e.g., fiscal or monetary policy), rather than one tool being used for both.

The Key to the Assignment Rule Is That One Powerful