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Be prepared to explain how credibility might affect the cost of reducing inflation.

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User Amiel
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If a central bank lacks credibility, investors and firms won't have much confidence in the central banks ability to keep inflation around its target
This means that no companies will be willing to put their money into the central bank (which will increase the rate of inflation. Because if w want to reduce it, we want the money circulation in the market to be decreased)
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User IntelliJ Amiya
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