In the Taylor Rule, If the Inflation Coefficient ? Is

Multiple Choice

In the Taylor rule, if the inflation coefficient ? is much larger than the output coefficient ?, then the central bank

A) is mostly concerned with maintaining full-employment
B) will raise interest rates more aggressively when output declines than when inflation heats up
C) will lower interest rates more aggressively when output declines than when inflation heats up
D) is engaging in strict inflation targeting
E) none of the above