What does the Taylor rule imply that policymakers should do to the overnight interest rate under the
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What does the Taylor rule imply that policymakers should do to the overnight interest rate under the following scenarios?
a. Unemployment rises due to a recession.
b. An oil price shock causes the inflation rate to rise by 1% and output to fall by 1%.
c. The economy experiences prolonged increases in productivity growth while actual output growth is unchanged.
d. Potential output declines while actual output remains unchanged.
e. The Bank of Canada revises its inflation target down.
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Related Book For
The Economics of Money Banking and Financial Markets
ISBN: 978-0321785701
5th Canadian edition
Authors: Frederic S. Mishkin, Apostolos Serletis
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