According to the Taylor Rule

According to the Taylor rule,

A) for every 1 percentage point that unemployment exceeds the natural rate of unemployment, there is a 2-percentage-point gap between potential and actual GDP.
B) growth in the money supply should be limited to the long-run average growth rate of real GDP.
C) if inflation rises by 1 percentage point above its target, then the Fed should raise the real federal funds rate by one-half a percentage point.
D) the rate of money growth should be set at 4 percent per year.