The Main Function of the 1997 Stability and Growth Pact

question 84

Multiple Choice

The main function of the 1997 Stability and Growth Pact (SGP) was to

• A) exclude a highly indebted EMU country
• B) enhance cooperation between France and Germany.
• C) tighten the fiscal constraints.
• D) distribute the Euro banknote among European central banks and to create a timetable for the imposition of financial penalties on countries that fail to correct situations of "excessive" deficits and debt promptly enough.
• E) determine specialized penalties for each member nation.

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Definitions:

Indirect Method

The indirect method is an accounting practice used in cash flow statements where net income is adjusted for non-cash transactions and changes in working capital to calculate cash flow from operating activities.

Cash Flows

The aggregate value of cash inflows and outflows within a corporation, significantly influencing its cash on hand.

Cash Flow Amounts

The total values of cash and cash-equivalents being transferred into and out of a business.

Timing

The selection of the best moment or speed at which to execute an action or operation.