Economists who support a monetary rule a. believe that the Fed should use discretionary monetary policy to fight recessions. b. believe that the Fed should use discretionary monetary policy to fight unemployment. c. believe that the Fed should increase the money supply at a consistently smooth rate. d. advocate having a high rate of inflation rather than a high rate of unemployment.

Economists who support a monetary rule

a. believe that the Fed should use discretionary monetary policy to fight recessions.

b. believe that the Fed should use discretionary monetary policy to fight unemployment.

c. believe that the Fed should increase the money supply at a consistently smooth rate.

d. advocate having a high rate of inflation rather than a high rate of unemployment.

 

 

answer:

The correct choice is C

Explanation : – Monetarists favor a “monetary rule,” where a broadly-defined money supply (usually M2) is increased at a steady rate equal to the long-run real GDP growth rate.

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