Which of the following statements is true regarding the extent to which the Fed has consulted the Taylor Rule in the past two years? (:3 A. The Fed very closely makes the federal funds rate follow the Taylor rule rate (:3 B. The Fed makes the federal funds rate follow the Taylor rule rate with a strict 3% varience either way {:3 C. None of these 3 possible other answers listed here are correct. {:3 D. By Mandate the Fed has to follow the Taylor Rule. Assume that the expected ination rate is 2%, lamda is .5, and the current ination rate is 2% what should the real interest rate be? if] A. 3% 4;} B. .5% {:3 C. 1.5% D. 5% Should the responsivenes value of real interest rate to ination decrease, how will that effect the MP curve? 5:) A. The MP multiplier will decrease [3- B. The slope of MP curve will get steeper 'sz1' C. The MP multiplier will increase (:3. D. The slope of the MP curve will get shallower Which of the following is a principle goal of the Bretton Woods System? O A. Create an efficient foreign exchange rate system O B. Encourage competitive devaluations of currencies O C. Create an efficient gold standard exchange rate system O D. Promote Peg Rate Systems Under a negative supply shock with a fully credible monetary policy, the AD curve and the AS curve in the short run. Inflation LRAS O A. does not shift; shifts down, but by more than Rate, It under a noncredible monetary policy O B. shifts left; shifts up O C. shifts right; does not shift O D. does not shift; shifts up, but by less than under a noncredible monetary policy On the graph to the right, point represents the short run effect of an aggregate supply shock if monetary policy is credible. Y3 Y2 YP Aggregate Out