The non-democratic character of the Board of Governors of the Federal Reserve System helps support ________.
A)the political business cycle
B)the time-inconsistency problem
C)its independence
D)rational expectations of Federal Reserve behavior

Question

Quizplus · Accepted Answer

The non-democratic structure of the Board of Governors, with members being appointed by the president and confirmed by the Senate for staggered, 14-year terms, helps to ensure its independence from political pressures. This allows the Federal Reserve to make monetary policy decisions based on what is best for the economy, rather than what is popular with politicians or voters.

The Non-Democratic Character of the Board of Governors of the Federal