Empirical Evidence Suggests Which of the Following About Central Bank

question 20

Multiple Choice

Empirical evidence suggests which of the following about central bank independence and inflation rates?

• A) More independent central banks are associated with lower rates of inflation.
• B) More independent central banks are associated with constant rates of inflation.
• C) More independent central banks are associated with higher rates of inflation.
• D) There is no observable relationship between inflation rates and central bank independence.

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Definitions:

Retained Earnings

The portion of net income which is retained by the corporation rather than distributed to its owners as dividends.

COGS

Cost of Goods Sold (COGS) refers to the direct costs associated with the production of goods sold by a company, including material and labor costs.

Gross Margin

Revenue less cost where cost is spending closely associated with production. Stated in dollars or as a percent of revenue. A fundamental measure of a business’s strength.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenues.