Use the Following to Answer Questions

question 198

Multiple Choice

Use the following to answer questions:
Figure: Monetary Policy and the AD-SRAS Model
-(Figure: Monetary Policy and the AD-SRAS Model) Refer to Figure: Monetary Policy and the AD-SRAS Model. The economy could move from point g to point f as a result of:

• A) an increase in the money supply.
• B) a reduction in the discount rate.
• C) a decrease in the money supply.
• D) purchases of government securities in the open market.

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Definitions:

Disbursement Float

The time delay between when a check is written and the actual withdrawal of funds from the account.

Book Balance

Refers to the amount of funds on record that a company has in its financial accounts at a specific point in time, not necessarily reflecting pending transactions.

Outstanding Cheques

Cheques that have been written and recorded in the accounting records but have not yet been cashed or cleared through the banking system.

Uncollected Deposits

Funds that have been deposited into a bank account but have not yet been cleared or recognized as available balance due to processing time.