To be successful in stabilizing an economy around potential output, a central bank should: Multiple Choice be prepared to make modest and frequent adjustments to its target interest rate after analyzing how its actions affect the economy. never announce its intentions regarding interest rate changes because financial markets always overreact. frequently change its target interest rate to keep financial markets guessing. change its target interest rate in response to increasing inflation but not to an economic boom. focus equally on inflation and the output gap in making interest rate decisions