Question: Central banks may be tempted to decrease unemployment below the natural rate in order to achieve a better outcome in the short run. In order
Central banks may be tempted to decrease unemployment below the natural rate in order to achieve a better outcome in the short run. In order to establish credibility that the central bank will not deviate from its announced policies, which of the following steps might be taken?
A
Make central banks accountable to elected officials.
B
Use quantitative easing regularly.
C
Elect central bank officials rather than appoint them.
D
Give central bank officials long terms in office.
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