Multiple Choice
Assume a central bank announced a zero percent inflation target.If the current inflation rate is 2.4%, and output is at the full-employment level, at what level should the central bank set the nominal interest rate according to the Taylor rule?
A) 1) 2%
B) 1) 8%
C) 2) 4%
D) 3) 0%
E) 3) 6%
Correct Answer:
Verified
Correct Answer:
Verified
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