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Recent research indicates that inflation performance (low inflation) has been found to be best
in countries with ____.
A) the most independent central banks
B) the least independent central banks
C) political control of monetary policy
D) a policy of always keeping interest rates low
Answer: A
Diff: 2 Type: MC Page Ref: 365
Skill: Recall
Objective List: 15.3 Describe the relationship between central bank independence and
macroeconomic performance
Recent research has found that countries with the most independent central banks have
experienced ____.
A) the lowest average rates of inflation
B) rates of inflation no different from countries with less independent central banks
C) the highest average rates of inflation
D) high inflation from financing deficits
Answer: A
Diff: 2 Type: MC Page Ref: 365
Skill: Recall
Objective List: 15.3 Describe the relationship between central bank independence and
macroeconomic performance
Countries with the most independent central banks have low inflation ____.
A) but have higher unemployment than countries with less independent central banks
B) but have higher output fluctuations than countries with less independent central banks
C) and have lower rates of unemployment than countries with less independent central banks
D) but have no higher unemployment or output fluctuations than countries with less independent
central banks
Answer: D
Diff: 3 Type: MC Page Ref: 365
Skill: Recall
Objective List: 15.3 Describe the relationship between central bank independence and
macroeconomic performance