average inflation gap is larger in absolute value than 0.5 for two or more consecutive quarters, consider the mandate “violated.” a.Based on this ad hoc test, in which quarters has the Fed “violated” the price stability portion of its mandate? In which quarters has the Fed “violated” the maximum employment mandate?
b.Is the Fed currently “in violation” of its mandate?
c.Interpret your results. What do your response to part (a) and the data imply about the challenge that monetary policymakers face in achieving the Fed’s mandate perfectly at all times?