Stanford University's Taylor on the Taylor Rule

Stanford University's Taylor on the Taylor Rule

Assessment

Interactive Video

Business

University

Hard

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The video discusses the debate on potential economic growth and the equilibrium real interest rate, which has shifted from 4% to possibly lower. It examines the Taylor rule's relevance in current economic conditions and the challenges of implementing rate cuts to stimulate the economy. The discussion also covers the potential use of negative interest rates and their implications, with a focus on future policy strategies.

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5 questions

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1.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is the current debate regarding the equilibrium real interest rate?

Whether it should be increased to 5%

If it has decreased from 4% to possibly lower

The impact of unemployment on interest rates

The role of inflation in determining interest rates

2.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What was the growth rate when the Taylor rule was first proposed?

3%

4%

5%

2.2%

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

Why is it challenging to have low growth rates according to the discussion?

It causes a rise in interest rates

It results in increased unemployment

It complicates the application of economic rules

It leads to higher inflation

4.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What is a potential issue with implementing negative interest rates?

They are universally accepted by central banks

They always lead to economic growth

They have been highly successful in Japan

They may not pass through the markets effectively

5.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

What does the Taylor rule suggest about the Fed funds rate?

It should be higher than the policy rate

It should be much lower than the policy rate

It should remain unchanged

It should be equal to the inflation rate