Choose the statement that is incorrect.
A)The Bank of Canada's strategy of inflation rate targeting that keeps the inflation rate low and stable makes the maximum possible contribution towards achieving full employment and sustained economic growth.
B)The Bank of Canada's strategy of inflation rate targeting has resulted in an inflation rate that is 0.3 percent per year below the core CPI inflation rate since 2000.
C)The last time the Bank of Canada created a recession was at the beginning of the 1990s when it was faced with the threat of ongoing double-digit inflation.
D)The Bank of Canada's monetary policy is sensitive to the state of employment while maintaining its focus on achieving its inflation target.
E)The inflation-control target uses the Consumer Price Index as the measure of inflation.

Question

Quizplus · Accepted Answer

The statement in choice B is incorrect because the Bank of Canada's strategy of inflation rate targeting does not consistently result in an inflation rate that is 0.3 percent per year below the core CPI inflation rate since 2000. The core CPI is often used as a measure to exclude volatile items, but the specific difference mentioned is not a consistent outcome of the Bank's policy.

Choose the Statement That Is Incorrect