Author Question: Using the Taylor rule, if the current inflation rate exceeds the target inflation rate and real GDP ... (Read 118 times)

KWilfred · **on:** Jun 29, 2018

Using the Taylor rule, if the current inflation rate exceeds the target inflation rate and real GDP exceeds potential GDP, then the federal funds target rate ________ the sum of the current inflation rate plus the real equilibrium federal funds rate.

A) may be greater than or less than B) will be greater than
C) will be the same as D) will be less than

Question 2

Refer to Table 4-4. If a minimum wage of 10.00 is mandated there will be a

A) shortage of 20,000 units of labor. B) surplus of 40,000 units of labor.
C) shortage of 40,000 units of labor. D) surplus of 20,000 units of labor.