According to the Taylor, if there is an expansionary gap of 2 percent of potential output and inflation is 3 percent, what real interest rate will the Fed set?
A. 0.015
B. 0.02
C. 0.035
D. 0.025
Answer: C
You might also like to view...
The U.S. government would never approve a proposed merger between two firms that could significantly increase the newly merged firm's market power even if the efficiency gains from the newly merged firm could make consumers better off
Indicate whether the statement is true or false
In the (consumption,leisure) space, indifference curves as we have assumed them have the property of presenting the highest levels of satisfaction
A) in the north-east corner. B) in the south-east corner. C) in the north-west corner. D) in the south-west corner.
One type of economic regulation often used in the United States by various public utility commissions allows prices to reflect only the actual cost of production and no monopoly profits. This type of economic regulation is known as
A) rate-of-return regulation. B) cost-of-service regulation. C) price per constant-quality-unit regulation. D) creative response regulation.
Goods that are produced in other countries and then sold domestically are called
A) exports. B) imports. C) tariffs. D) quotas.