The last option is cut off but it is 10 percent.

Use the following formula for the Taylor rule to determine the target federal funds rate. target federal funds tote natural rate of interest current infiation + Viinflation gam) Valoutput gop) where the curent rate of inflation is 5 percent, the natural rate of interest is 2 percent, the target rate of inflation la 2 percent, and output is 3 percent above its potential, the target federal funds rates Multiple Choice 65 percent 2.5 percent 31.5 percent