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Discuss the coefficients on the inflation gap and output gap terms in the Taylor rule given in the equation below . If you could change

Discuss the coefficients on the inflation gap and output gap terms in the Taylor rule given in the equation below . If you could change the relative importance of the coefficients, what would you choose?

Target fed funds rate = 2 + Current inflation + 1/2 (Inflation gap) + 1/2 (Output gap)

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