Between from 2002 through 2016 the Federal Reserve:
A)raised rates in order to follow the Taylor Rule.
B)left rates unchanged in order to follow the Taylor Rule.
C)lowered rates and went against the Taylor Rule.
D)abandoned the Taylor Rule in favor of the Greenspan Rule.

Question

Quizplus · Accepted Answer

The Federal Reserve lowered rates during this period, particularly in response to the 2008 financial crisis, which was a move against the Taylor Rule. The Taylor Rule is a monetary policy guideline that suggests how central banks should change interest rates in response to changes in economic conditions, particularly inflation and economic output. Lowering rates in the face of economic downturns, while potentially necessary for economic stability, can be seen as a deviation from the strict application of the Taylor Rule.

Between from 2002 Through 2016 the Federal Reserve