Question
If the Taylor Principle is followed and nominal interest rates are increased by more than the increase in the inflation rate, then real interest rates
If the Taylor Principle is followed and nominal interest rates are increased by more than the increase in the inflation rate, then real interest rates will . . . . . . . and monetary policy will be . . . . . . .
A. Rise; tight.
B. Rise; loose.
C. Fall; tight.
D. Fall; loose.
E. None of the above.
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Microeconomics
Authors: Paul Krugman, Robin Wells
5th edition
1319098780, 1319098789, 978-1319098780
