According to the Taylor, If There Is a Recessionary Gap

question 19

Multiple Choice

According to the Taylor, if there is a recessionary gap of 3 percent of potential output and inflation is 4 percent, what real interest rate will the Fed set?

• A) 0.015
• B) 0.02
• C) 0.025
• D) 0.03

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Definitions:

TAT

Thematic Apperception Test, a projective psychological test that involves creating stories about ambiguous scenes and images to uncover underlying thoughts and feelings.

Objective Tests

Tests designed to measure an individual's performance without subjective judgment, often featuring standardized questions and answer choices.

Psychoanalysis

A therapeutic approach founded by Sigmund Freud that aims to explore unconscious desires and conflicts as they manifest in behavior and mental disorders.

TAT

Thematic Apperception Test, a projective psychological test used to reveal a person's social drives or needs by their interpretation of a series of pictures of ambiguous scenes.