When the Financial Crisis Started in August 2007,inflation Was Rising

question 3

Multiple Choice

When the financial crisis started in August 2007,inflation was rising and the Fed began an aggressive easing lowering of the federal funds rate,which indicated that

• A)the Fed pursued an autonomous monetary policy tightening.
• B)the Fed pursued an autonomous monetary policy easing.
• C)the Fed had an automatic negative response to inflation based on the Taylor rule.
• D)the Fed had an automatic positive response to inflation based on the Taylor rule.

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