Economics · Monetary Policy
Flexible inflation targeting differs from strict inflation targeting because it seeks to:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Ignore inflation completely in favor of growth.
- 2Target only the stability of the nominal exchange rate.
- 3Minimize deviations of both inflation from its target and output from its potential level.✓
- 4Eliminate the role of forward-looking expectations in the economy.
Correct answer
Minimize deviations of both inflation from its target and output from its potential level.
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