the economics of money, banking, and financial markets

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5. 
   

   The ability of a central bank to set monetary policy goals is ____.
   A) political independence
   B) goal independence
   C) policy independence
   D) instrument independence
   Answer: B
   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

   
   


6. 
   

   Instrument independence is ____.
   A) the ability of the central bank to set monetary policy goals
   B) the ability of the government to set monetary policy goals
   C) the ability of the government to set monetary policy instruments
   D) the ability of the central bank to set monetary policy instruments
   Answer: D
   Diff: 2 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

   
   


7. 
   

   Goal independence is ____.
   A) the ability of the central bank to set monetary policy goals
   B) the ability of the government to set monetary policy goals
   C) the ability of the prime minister to set monetary policy instruments
   D) the ability of the government to set monetary policy instruments
   Answer: A
   Diff: 2 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

   
   


8. 
   

   The Bank of Canada enjoys ____.
   A) instrument independence
   B) political dependence
   C) goal independence
   D) Both A and C of the above.
   Answer: A
   Diff: 2 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