Which of the following statements about central bank structure and independence are true?
A) In recent years, with the exception of the Bank of England and the Bank of Japan, most countries have reduced the independence of their central banks, subjecting them to greater democratic control.
B) Before the Bank of England was granted greater independence, the Federal Reserve was the most independent of the worlds central banks.
C) Both theory and experience suggest that more independent central banks produce better monetary policy.
D) While the European Central Bank is independent, it is not as independent as the Federal Reserve.
Answer: C) Both theory and experience suggest that more independent central banks produce better monetary policy.
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Wages are paid to ________ and interest is paid to ________
A) entrepreneurs; capital B) labor; capital C) labor; land D) entrepreneurs; land E) labor; entrepreneurs
Consider a hypothetical economy, whose GDP was $10,000 . consumption equaled $9,800, investment equaled $125, goods exported equaled $255, and goods imported equaled $500, in 2010 . Calculate the government spending in this economy during the year
a. $120 b. $380 c. $245 d. $200 e. $320
Monopoly rights provided by patents are awarded to
a. encourage profit making b. guarantee competitive prices c. encourage competition d. the "first come, first served" e. encourage research and development
Steve borrowed some money from Summit Bank, telling the loan officer that he intended to use the money to remodel his restaurant. After getting the loan, Steve and his girlfriend immediately took the money and went gambling in Vegas
a. This is an example of adverse selection since banks have difficulty selecting their customers. b. This example does not involve asymmetric information. c. From the given information, Steve is the principal and Summit Bank is the agent. d. None of the above are correct.