438 $
© 2014 Pearson Canada Inc.$
15.4 How Independent is the Bank of Canada?
Instrument independence is the ability of ____ to set monetary policy ____.
A) the central bank; goals
B) Parliament; goals
C) Parliament; instruments
D) the central bank; instruments
Answer: D
Diff: 1 Type: MC Page Ref: 358
Skill: Recall
Objective List: 15.2 Identify the Bank of Canada's functions and degree of independence and
specify the arguments for and against an independent central bank
Economist Stanley Fisher defined two types of independence of central banks: ____ and
____ independence.
A) instrument; goal
B) policy; goal
C) instrument; political
D) parliamentary; decision
Answer: A
Diff: 1 Type: MC Page Ref: 358
Skill: Recall
Objective List: 15.2 Identify the Bank of Canada's functions and degree of independence and
specify the arguments for and against an independent central bank
The ability of a central bank to set monetary policy instruments is ____.
A) political independence
B) goal independence
C) policy independence
D) instrument independence
Answer: D
Diff: 1 Type: MC Page Ref: 358
Skill: Recall
Objective List: 15.2 Identify the Bank of Canada's functions and degree of independence and
specify the arguments for and against an independent central bank
Goal independence is the ability of ____ to set monetary policy ____.
A) the central bank; goals
B) Congress; goals
C) Congress; instruments
D) the central bank; instruments
Answer: A
Diff: 1 Type: MC Page Ref: 358
Skill: Recall
Objective List: 15.2 Identify the Bank of Canada's functions and degree of independence and
specify the arguments for and against an independent central bank