According to the Taylor rule, what should the federal funds rate target be if inflation is 5%, the target rate of inflation is 2%, the equilibrium real federal funds rate is 2%,
full-employment real GDP is $9 trillion, and current real GDP is $8.55 trillion?
Fed funds rate target = 5% + 2% + (1/2)(3%) + (1/2)(-5%) = 6%.
Economics
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A) a shift of the IP curve. B) an appreciation of the domestic currency. C) a reduction in E. D) no change in E.
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Government debt is the: a. amount of money that a government has borrowed from international sources but has not yet paid back. b. amount of money that a government has borrowed from domestic sources but has not yet paid back. c. total amount of money that a government owes in the economy
d. total amount of money that a government has borrowed from all the sources but has not yet paid back.
Economics