McCallum vs. Taylor rules?

CFA Level I
#1

Who focuses on GDP? What does each target? Maybe this is an easy one, but it’s vocab that you may forget about.

#2

I hate them both, like there’s no tomorrow!

#3

I have no idea where it comes from…

#4

McCallum is the new monetarist. Target: monetary base Focus: price stability Monetary base growth rate = target inflation+10-year moving average growth of real GDP - 4 year moving average growth of velocity of monetary base Taylor is the new Keynesian. Target: fed funds rate Focus: price stability and GDP Fed Funds rate=target inflation rate+2.5%+0.5*the difference between the actual and target inflation +0.5*difference between real an potential GDP

#5

Are we supposed to memorize the formula?

#6

I don’t think so. I swear this was a practice question though on the sample or mock test.

#7

It was and I got it wrong hah amberpower Wrote: ------------------------------------------------------- > I don’t think so. I swear this was a practice > question though on the sample or mock test.

#8

Me too, I just got to that pile of flash cards tonight.