In Countries with Low Inflation

question 47

Multiple Choice

In countries with low inflation:

• A) M2 growth is a very strong forecaster of inflation.
• B) there tends to be a greater reliance on checks than electronic payments.
• C) M2 growth is a poor forecaster of inflation.
• D) money stocks are a larger percentage of GDP.

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Definitions:

Checkbook Balance

The current total amount of money available in a checking account, as recorded by the account holder in their checkbook.

Outstanding Checks

Checks that have been written and recorded in the account balance but have not yet been cashed or cleared by the bank.

Outstanding Deposit

Funds that have been received but not yet processed by a financial institution.

Bank Statement Balance

The total amount of money that is available in a bank account at a particular point in time, as recorded by the bank.