Refer to the article "Rule it out" and answer these questions. Cite from the article directly as appropriate.

a. Using a well-labelled AD-AS diagram, briefly explain the dilemma facing a central bank when conducting a disinflationary policy.

b. Discuss ONE limitation mentioned in the article when adopting the Taylor's Rule to conduct a monetary policy.

reference :

Rule it out

Setting interest rates according to a fixed formula is a bad idea

Aug 8th 2015

http://www.economist.com/news/finance-and-economics/21660598-setting-interestrates-according-fixed-formula-bad-idea-rule-it-out