The price stability strategy during the 1980s
A) was a reaffirmation of Keynesian principles.
B) asserts that the only proper objective of monetary policy was to achieve and maintain a very low and stable rate of inflation.
C) asserts that the only proper objective of monetary policy was to achieve and maintain a very high but stable rate of inflation.
D) asserts that the only proper objective of monetary policy was to achieve and maintain a very low even if unstable rate of inflation.
E) occurred first in Switzerland.

Question

Quizplus · Accepted Answer

The price stability strategy during the 1980s asserted that the only proper objective of monetary policy was to achieve and maintain a very low and stable rate of inflation. This was a departure from the Keynesian principles that emphasized the role of government intervention in stabilizing the economy. The goal of price stability was seen as essential for promoting long-term economic growth and improving the overall welfare of society. This approach was adopted by many central banks, including the Federal Reserve in the United States.

The Price Stability Strategy During the 1980s