Answer :
When the government institutes new measures in an attempt to limit inflation, the macroeconomic goal it is directly related to is C. Stable Prices.
What is a macroeconomic goal?
A macroeconomic goal is an achievement that an economy attains in order to maximize the standard of living of the people and achieve stable economic growth.
There are four macroeconomic goals, including:
- Economic Growth
- Economic Stability
- Full employment
- Stable financial market.
The macroeconomic goals are supported by the following objectives:
- Minimizing unemployment
- Increasing productivity
- Controlling inflation.
Answer Options:
A. Equity
B. Efficiency
C. Stable Prices
D. Full Employment
Thus, when the government institutes new measures in an attempt to limit inflation, the macroeconomic goal it is directly related to is C. Stable Prices.
Learn more about macroeconomic goals at https://brainly.com/question/19098930
The action of a government instituting measures to limit inflation is most directly related to the macroeconomic goal of maintaining low inflation. Governments use tools such as taxes, spending, and interest rate regulations to align purchasing power growth with the production of goods.
When a government institutes new measures to limit inflation, it is directly targeting the macroeconomic goal of maintaining low inflation. Inflation is a rise in the general level of prices of goods and services in an economy over a period of time. If the inflation rate is too high, it can erode purchasing power and destabilize the economy. To control inflation, governments can utilize various macroeconomic policies, which include influencing the amount of purchasing power through taxes, spending, and regulation of interest rates and credit. This ensures that the growth of purchasing power aligns with the production of goods, preventing excessive inflation.
Moreover, historical evidence shows that hyperinflations often ended when governments achieved fiscal balance and eliminated deficit spending. Additionally, commitment to low inflation can be strengthened by delegating monetary policy to conservative and independent central banks, possibly through mechanisms like a currency board or joining a monetary union. This helps to avoid the government's use of new money to buy goods or financial assets, which could otherwise cause economic distortions.
