In order to fight recession, the RBA has to raise its inflation target in order to reduce the real interest rate needed to stimulate the aggregate demand.

Name: In order to fight recession, the RBA has to raise its inflation target in order to reduce the real interest rate needed to stimulate the aggregate demand.
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Question

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Raising the inflation target can lower real interest rates, which can stimulate aggregate demand by making borrowing cheaper and encouraging spending.

In Order to Fight Recession, the RBA Has to Raise