Which of the Following Statements Is True

question 123

Multiple Choice

Which of the following statements is true?

• A)Central bank independence guarantees that central banks won't make more mistakes than they would if they were not independent.
• B)Central bank independence guarantees that the central bank will always pursue price stability.
• C)Independent central banks do not need to be held accountable for their actions.
• D)Central bank independence can be taken too far.
• E)Central banks should pursue the goal of price stability at all costs.

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Definitions:

Debt Service Fund

A fund established to account for the accumulation of resources for, and the payment of, long-term debt principal and interest.

General Fund

The primary operating fund of a government, financing a variety of its general activities and services.

Governmental Fund Financial Statements

These are financial reports that detail the financial position and results of operations of governmental funds, focusing on the sources, uses, and balances of expendable financial resources.

Governmental Fund

Fiscal and accounting entities used by governments to manage resources derived from tax and other revenues for specific purposes.