In the Simple Monetary Policy Rule $R _ { t } - \bar { r } = \bar { m } \left( \pi _ { t } - \bar { \pi } \right)$

question 13

Multiple Choice

In the simple monetary policy rule $R _ { t } - \bar { r } = \bar { m } \left( \pi _ { t } - \bar { \pi } \right)$ , $\left( \pi _ { t } - \bar { \pi } \right)$
Represents:

• A) the marginal product of capital
• B) how sensitive monetary policy is to changes in inflation
• C) the deviation of the inflation rate from the target rate
• D) the target rate of inflation
• E) the risk premium

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