An Inflation Target Is

Multiple Choice

An inflation target is

A) the difference between the current federal funds rate and the current real interest rate.
B) what the rate of inflation equals when the real interest rate equals zero.
C) what the rate of inflation equals when the nominal interest rate equals zero.
D) the rate of inflation the central bank tries to maintain, on average, over the long run.
E) what the rate of inflation equals when the real and nominal interest rates equal each other.