According to the Taylor rule: r = 0.01 + 0.5*[(Y – Y*)/Y*]…
According to the Taylor rule: r = 0.01 + 0.5* + 0.5 π , if inflation equals 2 percent and there is an expansionary gap equal to 2 percent of potential output, the Fed will set a real interest rate of __________ percent and a nominal interest rate of __________ percent.