According to the Taylor rule, if the inflation rate is one percentage point below the target of 2 percent but at full employment, then the Fed should Multiple Choice raise the real federal funds rate by one percentage point. lower the real federal funds rate by one percentage point. raise their targeted interest rate by half of a percentage point. lower their targeted interest rate by half of a percentage point.

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22-12-2021
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According to the Taylor rule, if the inflation rate is one percentage point below the target of 2 percent but at full employment, then the Fed should Multiple Choice raise the real federal funds rate by one percentage point. lower the real federal funds rate by one percentage point. raise their targeted interest rate by half of a percentage point. lower their targeted interest rate by half of a percentage point.

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topeadeniran2 topeadeniran2 · Answer 1 · 2021-12-29T12:07:28+01:00

Based on the information given about the inflation rate, the correct option will be C. raise their targeted interest rate by half of a percentage point.

Inflation simply means the rate it increase in the prices of goods over a particular period of time. It leads to an increase in the cost of living.

According to the Taylor rule, if the inflation rate is one percentage point below the target of 2 percent but at full employment, then the Fed should raise their targeted interest rate by half of a percentage point.

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