In 2012, the Fed adopted a ﬂexible version of
A) a monetary-growth rule.
B) inﬂation targeting.
C) a balanced-budget policy.
D) a do-nothing approach.

Question

Quizplus · Accepted Answer

The Fed adopted an inflation targeting approach in 2012, meaning that it aims to keep inflation at a specific target level and adjusts its monetary policy accordingly. This is a flexible version of inflation targeting, which allows for some deviation from the exact target level in response to economic conditions.

In 2012, the Fed Adopted a ﬂExible Version of