Why does the Federal Reserve target inflation rather than unemployment?
A)The inflation rate is an easy target to attain.
B)Full employment is not an attainable target.
C)It would be poor optics for the Fed to intentionally increase unemployment.
D)The inflation rate does not change much.

Question

Quizplus · Accepted Answer

The Federal Reserve targets inflation because it is a more stable and controllable economic indicator. Intentionally increasing unemployment would be politically and socially unacceptable, as it directly affects people's livelihoods.

Why Does the Federal Reserve Target Inflation Rather Than Unemployment