TRUE/FALSE/UNCERTAIN??

2. Rising interest rates are a sign of a stronger economy.

3. The money multiplier reflects the existence of a banking system.

4. There is credible evidence that central banks in the advanced countries have used monetary policies for the purpose of creating political business cycles.

5. Some inflation in the economy is good but zero or negative inflation is bad.

6. Monetary policy can have a distortionary impact on asset prices.

7. The goal of monetary policy in Canada is price stability, while the goal of monetary policy in the United States is price stability and maximum employment.

8. The Bank of Canada can counter deflationary pressures by expanding its balance sheet.

9. In the past two decades monetary policy in Canada and the United States is well described as following a Taylor rule.

10. The real interest rate can be measured precisely, and therefore it is the best indicator of the stance of monetary policy.

11. An increase in the expected rate of inflation results in an increase in the money supply.

12. Negative nominal interest rates mean negative real interest rates.

13. Open market operations lower the nominal interest rate but not the real interest rate.

14. The Bank of Canada controls the money supply as accurately as it wants by controlling the monetary base.

15. All money is credit, so increasing the supply of credit must lower the interest rate and the price level.

16. Helicopter money works better than quantitative easing or credit easing.

17. The current 2% inflation target is too low, and therefore the Bank of Canada should pursue a higher inflation target which may be more consistent with the long-term goal of maximum employment.

18. The Bank of Canada is totally independent from the government and it can choose its policy goals and instruments.

19. An increase in the market interest rate will likely cause an increase in the money supply.

20. The Bank of Canada can increase people's wealth by decreasing interest rates.