In 2015, an article in a publication of the Federal Reserve Bank of San Francisco noted, "FOMC participants have steadily lowered their estimates of the natural rate of unemployment . . . over the past several years." The article also noted that "a lower natural rate of unemployment also implies a lower target policy rate."
a. Why might members of the FOMC have believed that the natural rate of unemployment was lower in 2015 than it had been several years earlier?
b. What does the article mean by the Fed's "target policy rate"?
c. Why would a lower estimate of the natural rate of unemployment lead the Fed to lower its target policy rate?