1. The Taylor rule is a monetary policy guideline
A. for determining a target for the inflation rate.
B. developed by Alan Greenspan, but summarized by economist John Taylor for determining the target for the federal funds rate
C. developed by economist John Taylor for determining the target for the federal funds rate.
D. developed by economist John Taylor for determining the target for the reserve rate.
2. How can the Taylor rule be used as a guide to evaluating Federal Reserve monetary policy over time?
A. With the Taylor rule, it is possible to compare the actual inflation rate with the inflation target.
B. If the federal funds rate calculated by the Taylor rule is positive over time, then Federal Reserve monetary is accurate policy.
C. Using the Taylor rule, it is possible to compare the actual reserve rate with the reserve rate target.
D. Using the Taylor rule, it is possible to compare the actual federal funds rate with the federal funds rate target.