An Inflation Target Is

question 102

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.

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