Economists who really do want to take discretion away from the Fed,by imposing rules on ________,face the problem of ________.
A)policy instruments,the Fed requiring discretion to adhere to the rule
B)policy instruments,slippages between instruments and target variables
C)target variables,the Fed requiring discretion on how to achieve the rule
D)target variables,slippages between instruments and target variables

Question

Quizplus · Accepted Answer

Imposing rules on policy instruments can lead to slippages between the instruments and the target variables, which may require some discretion from the Fed to achieve the desired outcomes. Therefore, economists who advocate for rules-based policies face the problem of how to avoid such slippages and ensure that the Fed adheres to the chosen rules while preserving sufficient flexibility to respond to changing economic conditions.

Economists Who Really Do Want to Take Discretion Away from the Fed,by