Questions and Answers
Who controls monetary policy?
What is a characteristic of central banks in developed economies?
Which of the following is the central bank of the US?
Where is the European Central Bank located?
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Which of the following currencies is managed by the Bank of England?
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What is the primary purpose of monetary policy?
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What tools does monetary policy use to achieve its objectives?
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Which institution is responsible for implementing monetary policy in Ireland?
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What is a key characteristic of monetary policy in the eurozone?
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What is the scope of the European Central Bank's (ECB) control over monetary policy?
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Study Notes
Role of a Central Bank
- Monetary policy is controlled by a central bank, not a government.
- In developed economies, central banks are independent and do not take instructions from politicians.
Examples of Central Banks
- The Federal Reserve (The Fed) is the central bank of the US and is responsible for the dollar.
- The Bank of England is the central bank of the UK and is responsible for the pound sterling.
- The European Central Bank (ECB), located in Frankfurt, Germany, is the central bank of the eurozone and is responsible for the euro.
Monetary Policy Overview
- Monetary policy involves the use of interest rates, money supply, and credit availability to achieve economic objectives.
Monetary Policy in Ireland and the Eurozone
- The European Central Bank (ECB) has control over monetary policy in Ireland and the eurozone.
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Description
Learn about the role of central banks in controlling monetary policy, their independence in developed economies, and examples of central banks around the world.
