manlycool9571 manlycool9571

20-05-2024
Business

Answered

Suppose the inflation rate target is 2% and the long run federal funds target is 3.5% Using the Taylor rule, calculate the federal funds rate if the current inflation rate is 5% and real output is 6% below trend output
A) 11.0%
B) 3.5%
C) 5.0%
D) 4.5%

Answer :

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