Categorize the following statements as True/False/Uncertain and explain

a News will always impact inflationary expectations in both developed and developing economies

b As the economy becomes more volatile in terms of supply and political shocks, centrals banks in certain regions will witness how weak their common currency areas are. Unfortunately there are no ways to determine this or prepare for them.

c There is no reason to believe that the "King dollar" will every be dethroned because if it did there would be hell to pay. China and Russia are small players that will never catch up. The dollar is the world currency given US military might.

d The Taylor rule is good but it does do much to show how monetary policy is conducted before or after a major inflation crisis. Also, they can't do much in showing common currency areas are optimal. How could they?

Answer rating: 100% (QA)

a Uncertain The impact of news on inflationary expectations can vary depending on various factors such as the nature of the news the credibility of th... View the full answer