One Criticism of the Bank of Canada's Focus on an Inflation

question 83

Multiple Choice

One criticism of the Bank of Canada's focus on an inflation control target is that

• A)if inflation falls below the target range, a recession will result.
• B)if inflation edges above the target range, the Bank decreases aggregate demand and could create a recession.
• C)the Bank pays too much attention to unemployment and real GDP growth and not enough to inflation control.
• D)it makes setting expectations of inflation difficult.
• E)the Bank rarely achieves its target.

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Definitions:

Separate Income Tax Returns

Tax documents filed individually by entities or persons instead of jointly or as part of a consolidated group.

Tax Rate

The proportion of income that the government takes as tax from an individual or a company.

Accrual-based Consolidated Net Income

The net income of a consolidated group of companies, calculated using the accrual method of accounting, which records revenues and expenses when they are incurred, regardless of cash movement.

Proportionate Book Value

The value of a company based on its balance sheet, where assets and liabilities are proportionately adjusted to reflect its actual market value.