In theory, fiscal policy can be as effective in stabilizing the economy as is monetary policy. What are the practical reasons that modern nations typically rely on central banks and monetary policy for stabilizing output, employment, and inflation?

In theory, fiscal policy can be as effective in stabilizing the economy as is monetary policy. What are the practical reasons that modern nations typically rely on central banks and monetary policy for stabilizing output, employment, and inflation?

Macroeconomics: Private and Public Choice (MindTap Course List)

16th Edition

ISBN:9781305506756

Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson

Chapter15: Macroeconomic Policy, Economic Stability, And The Federal Debt

Section: Chapter Questions

Problem 7CQ

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In theory, fiscal policy can be as effective in
stabilizing the economy as is monetary
policy. What are the practical reasons that
modern nations typically rely on central
banks and monetary policy for stabilizing
output, employment, and inflation?

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