Using Taylor's Rule,when the Equilibrium Real Federal Funds Rate Is

question 12

Multiple Choice

Using Taylor's rule,when the equilibrium real federal funds rate is 2 percent,there is no output gap,the actual inflation rate is zero,and the target inflation rate is 2 percent,the nominal federal funds rate should be

• A)0 percent.
• B)1 percent.
• C)2 percent.
• D)3 percent.

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