The correlation between the degree of central bank independence and average rate of inflation tends to be
A) negative
B) positive
C) there is no correlation
D) none of the above

Question

Quizplus · Accepted Answer

Research has shown that countries with a higher degree of central bank independence tend to have lower average rates of inflation. This is because an independent central bank has more freedom to make decisions based on economic considerations rather than political pressure or influence.

The Correlation Between the Degree of Central Bank Independence and Average