The Taylor Principle Differs from the Taylor Rule Because ________

Multiple Choice

The Taylor Principle differs from the Taylor rule because ________.

A) it does not provide a rule for how monetary policy should react to conditions in the economy
B) the Taylor principle relates to real interest rates and the Taylor rule pertains to nominal interest rates
C) the Taylor principle is exclusively used by the Bank of Canada while the Taylor rule is used by the U.S. Fed
D) the Taylor rule relates to inflation rates while the Taylor principle is applied to real interest rates