The case for the Federal Reserve independence includes the idea that A. Political pressure would impart inflationary bias to monetary policy B. A politically insulted Fed would be more concerned with long run objectives and thus be a defender of a sound dollar and a stable price level C. A Federal Reserve under the control of Congress or the President might make the so called political business cycle more pronounced D. All of the above Solution The answer would be all the above because with indipendent Fed, all the decisions can be taken indipendently in the interst of the economy rather than the interst of the government..

1. The case for the Federal Reserve independence includes the idea that
A. Political pressure would impart inflationary bias to monetary policy
B. A politically insulted Fed would be more concerned with long run objectives and thus be a
defender of a sound dollar and a stable price level
C. A Federal Reserve under the control of Congress or the President might make the so called
political business cycle more pronounced
D. All of the above
Solution
The answer would be all the above because with indipendent Fed, all the decisions can be taken
indipendently in the interst of the economy rather than the interst of the government.