Countries with more independent central banks have lower inflation rates, but these have come at the expense of greater output fluctuations.

True

False

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Devon Austin

Today, 17:22

Countries with more independent central banks have lower inflation rates, but these have come at the expense of greater output fluctuations.

True

False

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Answers (1)

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Camden Porter · Answer 1

False

Explanation:

Countries with more independent central banks have lower inflation rates, but these have come at the expense of greater output fluctuations is a false statement as we know that, an independent Central Bank could have higher credibility. If somebody has a higher conviction in the Central Bank, this accommodates to subdue inflationary expectations. Indeed, this causes inflation more accessible to keep lowering.

Countries with more independent central banks have lower inflation rates, but these have come at the expense of greater output fluctuations.TrueFalse

Countries with more independent central banks have lower inflation rates, but these have come at the expense of greater output fluctuations.

True

False