The Taylor Rule Relates

question 6

Multiple Choice

The Taylor rule relates

• A)the nominal Fed funds rate to inflation over the past year and the deviation of output from full-employment output.
• B)the growth rate of the monetary base to the growth rate of nominal GDP and the change in velocity over the past year.
• C)the nominal Fed funds rate to the growth rate of nominal GDP and the change in velocity over the past year.
• D)the growth rate of the monetary base to inflation over the past year and the deviation of output from full-employment output.

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Definitions:

No-fault Insurance

An insurance policy where each party's insurance company pays for their own losses, regardless of who was at fault in the incident.

Short-rate Refund

A partial refund of an insurance premium, calculated using the short-rate method, which accounts for administrative costs and the increased risk to the insurer of policies cancelled before their original expiration.

Premium Rate

The price of an insurance premium per unit of coverage, often expressed in terms of monthly or annual cost.

Premium Rate

The price of an insurance policy, typically quoted as a cost per hundred or thousand dollars of coverage.