If inflation is one percentage point above the Fed's target, the Taylor rule predicts that the Fed should:

A. raise the federal funds rate by 0.5 percentage points.
B. reduce the federal funds rate by 1.0 percentage points.
C. reduce the federal funds rate by 1.5 percentage points.
D. raise the federal funds rate by 1.0 percentage points.


Answer: A

Economics

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When a country exports a good, the country's producer surplus ________, consumer surplus ________, and the country ________ from the trade

A) increases; increases; gains B) decreases; increases; gains C) increases; decreases; gains D) decreases; decreases; loses E) increases; decreases; loses

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Suppose that in 2016, the national income in the United States was $200 billion, depreciation was $15 billion, personal taxes were $20 billion, and transfer payments were $10 billion. Gross domestic product in 2016 is

A) $185 billion. B) $215 billion. C) $220 billion. D) $245 billion.

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If the average price of a car suddenly changes from $15,000 to $25,000, larger, more remote stores with lower prices are ________ to have a(n) ________ in the number of customers.

A) not likely; change B) likely; decrease C) likely; increase D) not likely; decrease

Economics

Which of the following helps in determining whether health care cost rises because of government policy, or because of demand rising faster than supply?

a. Examining the market for health care away from the belief that the market outcome is unfair b. Examining the market for health care with the belief that the market outcome is unfair c. Examining the allocation system d. Examining the changes in the price of health care products e. Examining the changes in the number of suppliers of health care in the market

Economics