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Author Question: The ground rules, customs, and conventions that govern the behavior of market participants are known ... (Read 57 times)

wenmo

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on: Jun 29, 2018
The ground rules, customs, and conventions that govern the behavior of market participants are known as ________.
 
  Fill in the blank(s) with correct word

Question 2

Describe inflation targeting rule as a monetary policy. What are its benefits?
 
  What will be an ideal response?


Jordin Calloway

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Reply #1 on: Jun 29, 2018
Answer to Question 1

institutions

Answer to Question 2

Inflation targeting requires that the nation's central bank set and then make public an explicit target for the inflation rate. Then the central bank must explain how its policy actions are designed to achieve its inflation goal. Inflation targeting has the major advantage of firmly setting the public's expected inflation rate. It also serves to keep the actual inflation rate because central banks are loathe to set a target level for inflation.


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