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vellojo vellojo
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8 years ago
In the economy of Callumtaylia, the current inflation rate is 6 percent and the Central Bank's target inflation rate is 2 percent. Real GDP exceeds potential GDP by 1 percent, and the long-term growth rate of real GDP is 5 percent. The medium-term growth rate of the velocity of circulation of the monetary base is 2 percent.
a)   According to the McCallum rule, what growth rate of the economy's monetary base should the Central Bank set?
b)   According to the Taylor rule, what federal funds rate should the Central Bank set?
c)   What are two major differences between the McCallum rule and the Taylor rule?
Textbook 
Foundations of Macroeconomics

Foundations of Macroeconomics


Edition: 8th
Authors:
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Studying economics @ Edinburgh U
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ukraniaukrania
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vellojo Author
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#2
7 years ago
Checks out after I submitted my assignment Smiling Face with Open Mouth
Studying economics @ Edinburgh U
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#3
7 years ago
Happy to help Slight Smile
Dream it. Person Raising Both Hands in Celebration
Wish it. Person Raising Both Hands in Celebration
Do it. Person Raising Both Hands in Celebration
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