The inflation target: Nearly every major central bank has chosen an inflation target of 2%. a. Why

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The inflation target: Nearly every major central bank has chosen an inflation target of 2%.

a. Why might a central bank choose a lower inflation target, for example, zero inflation?

b. Why might a central bank choose a higher inflation target, for example, $4 \%$ inflation?

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Macroeconomics

ISBN: 9780134897899

8th Edition

Authors: Olivier Jean Blanchard

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Question Posted: Mar 11, 2024 03:00 AM

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The inflation target: Nearly every major central bank has chosen an inflation target of 2%. a. Why

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a Choosing a Lower Inflation Target eg Zero Inflation Price Stability A central bank might choose a lower inflation target such as zero inflation to e...View the full answer

Macroeconomics

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