Assess the following statements S1 and S2. Are they both true, both false or is only one
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Assess the following statements S1 and S2. Are they both true, both false or is only one true? Justify your answer.
S1. A monetary policy maker will achieve stabilization at least cost by committing to a pricelevel target.
S2. When a monetary policy maker has discretion to choose the interest rate in each period, they will follow the same adjustment path as under commitment because this minimizes the cost of adjustment to shocks.
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Related Book For
Macroeconomics Institutions Instability And The Financial System
ISBN: 9780199655793
1st Edition
Authors: Wendy Carlin, David Soskice
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