According to the Taylor Rule: If the Inflation Rate Is

question 167

Multiple Choice

According to the Taylor Rule: if the inflation rate is 2% and the GDP gap is 3%,what does the federal funds rate target equal?

• A) 9.5 percent
• B) 7.5 percent
• C) 5.5 percent
• D) 8.5 percent

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Definitions:

Battery Voltage

The electric potential difference measured across the terminals of a battery, indicating the battery's charge state.

Atkinson Cycle

A modified four-cycle gasoline engine. Compared to the conventional model, the intake stroke in the Atkinson cycle is allowed to continue longer, until the piston is moving back up to compress the air-fuel mixture. This forces some of the air-fuel charge from the cylinder and back into the intake. The reduced charge generates less power but also uses less fuel and produces fewer emissions.

Intake Valve

A valve in an engine that opens to allow air-fuel mixture into the combustion chamber during the intake stroke.

Compression Stroke

The stage of engine operation during which the air-fuel mixture is compressed in the cylinder by the upward motion of the piston.