It is also determined on a given market basket by the CPI, and comes in demand-pull and cost-push varieties.
It can lead to the so-called shoe leather cost, and although Robert Barro argued the opposite, the Tobin Effect claims that it aids growth. The Fisher and Marshall-Edgeworth indices are sometimes used for it, and seigniorage is sometimes known as this kind of tax. Denoted by pi in a Taylor rule, it may be targeted. Commonly computed using a Laspeyres or Paasche index, it causes menu costs, and it may be desired to escape a liquidity trap. The ‘core' variety is important for its predictive ability. It is also determined on a given market basket by the CPI, and comes in demand-pull and cost-push varieties. The difference between real and nominal interest rates, name, for 10 points, this situation, which the Phillips Curve describes as a tradeoff against unemployment.
It can lead to the so-called shoe leather cost, and although Robert Barro argued the opposite, the Tobin Effect claims that it aids growth.
{inflation}