The Bank of Canada adheres to the ideas expressed by ________.If the economy moves into a recession, the Bank of Canada would recommend that the overnight lending rate decrease as long as the inflation rate did not rise above the publicly announced goal for inflation.

Question

Quizplus · Accepted Answer

The Bank of Canada follows the concept of flexible inflation targeting, which means that it sets a publicly announced target for inflation and adjusts the overnight lending rate to ensure that inflation stays within the target range. If the economy enters a recession, the Bank of Canada would lower the overnight lending rate to encourage borrowing and stimulate economic activity, as long as inflation remains within the target range. The other options mentioned in the question (gold standard, monetarist school of thought, Taylor Rule, and Milton Friedman) are not directly related to the Bank of Canada's policy approach.

The Bank of Canada Adheres to the Ideas Expressed by ________.If