Technically speaking, maximizing profit means finding the maximum difference between

Suppose the nominal interest rate is five percent, and the inflation rate rises from two percent to three percent

Might an increase in the nominal interest rate to 5.5 percent be consistent with the Taylor Principle? If not, what consequences might ensue?

If there are no restrictions on contracts, and if all parties in the economy accurately predict the rate of inflation over the next year, then

a. there will be no redistribution of purchasing power b. purchasing power will be redistributed from wage earners to business owners c. purchasing power will be redistributed from business owners to wage earners d. purchasing power will be redistributed from lenders to borrowers e. purchasing power will be redistributed from borrowers to lenders