According to the Taylor Rule, If the Output Gap Falls

question 37

Multiple Choice

According to the Taylor Rule, if the output gap falls by 2% and inflation rises by 2%, then the federal funds rate should rise by

• A) 2.0%.
• B) 2.5%.
• C) 3.0%.
• D) 3.5%.

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Definitions:

Polygraph Machine

A device used to measure and record physiological indicators such as blood pressure, pulse, respiration, and skin conductivity while a person is asked and answers a series of questions, purported to indicate truthfulness.

Lie Detector

A device or procedure that attempts to determine whether a person is telling the truth by measuring physiological responses.

Emotion Detector

A technology or tool designed to identify and classify human emotions based on various inputs such as facial expressions, voice patterns, or physiological responses.

Nonverbal Communication

The transmission of messages or signals through a non-linguistic means, such as facial expressions, body language, or gestures.