Which of the Following Benefits Flow from the Application of an Inflation-Control

question 76

Multiple Choice

Which of the following benefits flow from the application of an inflation-control target?

• A)If actual inflation exceeds the target range, the Bank of Canada can induce a recession to correct the matter.
• B)The monetary authorities can change the target range whenever they feel it is appropriate.
• C)People can make decisions with an understanding that inflation rates will remain relatively low.
• D)Financial market traders have a clearer understanding of the Bank of Canada's intentions.
• E)Both C and D

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Definitions:

Accounts Payable

Amounts a company owes to creditors for goods or services bought on credit.

General Journal

A primary accounting record used to keep track of all financial transactions, listed in chronological order.

Overcharge Creditor

The act of charging a creditor more than the agreed amount or more than the fair price for goods or services.

Adjustment Recorded

The act of documenting changes to accounts to correct or update financial information.