Research has indicated that countries in which the central bank has the most independence experience
A)slower growth rates of the money supply.
B)faster growth rates of the money supply.
C)no difference in the growth rate of the money supply.
D)higher budget deficits.

Question

Quizplus · Accepted Answer

Countries with independent central banks tend to have slower growth rates of the money supply because the central bank has more control over monetary policy. This control allows them to adjust interest rates and take other measures to ensure stable inflation and a stable economy. Higher budget deficits, on the other hand, might indicate that the government is relying on inflation to pay off its debts, which could be a sign of a less stable economy.

Research Has Indicated That Countries in Which the Central Bank