Author Question: If the Fed follows the Taylor rule and the economy goes into a recession, the Fed would A) raise ... (Read 59 times)

TFauchery · **on:** Jun 29, 2018

If the Fed follows the Taylor rule and the economy goes into a recession, the Fed would

A) raise the federal funds rate
B) reduce tax rates.
C) increase government expenditures.
D) lower the federal funds rate.
E) None of the above answers is correct.

Question 2

If real GDP exceeds potential GDP, then employment is ________ full employment, and the unemployment rate is ________ the natural unemployment rate.

A) equal to; below
B) above; below
C) equal to; equal to
D) below; above
E) above; above