The Bank of Canada is influenced by the federal government, as it appoints a governor, but the bank still has flexibility in meeting the goals of monetary policy. However, the bank is independent in the sense that it operates without direction from the government and is solely responsible for decisions related to monetary policy.

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The Bank of Canada

Question 77

Multiple Choice

The Bank of Canada

A) has complete independence from the Canadian government.
B) is influenced by the federal government which appoints a governor, but has flexibility in meeting the goals of monetary policy.
C) is a government agency run by the Ministry of Finance.
D) is run by elected officials but is only subject to oversight by the Canadian prime minister.

Correct Answer: