By the end of this chapter, students should be able to:
- Define central bank and explain the importance of central banking.
- Briefly sketch the history of U.S. central banking.
- Explain when and how a country can do without a central bank.
- Briefly sketch the structure of the Federal Reserve System.
- Explain how other central banks compare to the Fed.
- Define central bank independence and explain its importance.
- Explain why independent central bankers prefer lower inflation rates than government officials do.