"Inflation Targeting Rule" is a special case of a
A) Taylor Rule with zero weight on output.
B) Taylor Rule with zero weight on inflation.
C) Taylor Rule with an equal weight on output and inflation.
D) Taylor Rule with different but positive weights on output and inflation.
A
Economics
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Suppose a Japanese bank offers a 4 percent interest rate and U.S. banks offer a 2 percent interest rate. People must expect the yen to
A) depreciate by 2 percent. B) appreciate by 2 percent. C) depreciate by 6 percent. D) appreciate by 6 percent.
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Why are real interest rates more important than nominal interest rates with regard to analyzing the supply and demand of loanable funds?
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