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QUESTION 60
If the Federal Reserve tries to target inflation near 2%, the inflation rate is 3%, and output is 3% below potential GDP, the target federal funds rate
according to the Taylor rule is:
3%
4%
O
O
5%
O 6%
QUESTION 61
If the Fed pursues an expansionary monetary policy:
the dollar will rise.
O
U.S. imports from other countries will rise.
O
U.S. exports to other countries will rise.
O aggregate supply will increase.

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