Evidence indicates that inflation rates are
A)lowest when politicians control the central bank
B)lowest in countries where the monetary authority has the most independence
C)most effectively controlled by elected politicians
D)highest in countries where the monetary authority has the most independence
E)unaffected by the actions of monetary policy makers

Question

Quizplus · Accepted Answer

Studies have shown that countries with more independent central banks tend to have lower inflation rates. This is because independent central banks are better equipped to make decisions based on economic considerations rather than political considerations, which can lead to a more stable monetary policy.

Evidence Indicates That Inflation Rates Are