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Taylor's Simplified 1993 Rule States That

Question 38

Multiple Choice

Taylor's simplified 1993 rule states that


A) the nominal interest rate increases less than one-for-one with the inflation rate.
B) the nominal interest rate increases one-for-one with the natural real rate of interest.
C) the zero lower bound is irrelevant.
D) the nominal interest rate increases one-for-one with the inflation rate.
E) the nominal interest rate should not depend on the natural real rate of interest.

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