One Reason Most Central Bankers Do Not Set an Inflation

question 10

Multiple Choice

One reason most central bankers do not set an inflation target of zero is:

• A)It is almost impossible to achieve
• B)They believe it would cause deflation
• C)It would hit the zero nominal-interest-rate bound
• D)None of the answers given is correct

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Definitions:

Percentage Breakdown

A method of expressing components of a whole as percentages to show their relative sizes or contributions to the total.

Accounting Process

A systematic series of actions to record, summarize, and report the financial transactions of a business over a period, resulting in the preparation of financial statements.

Journals

Official records where business transactions are entered before they are transferred to accounts in the general ledger.

Ratios

Quantitative relationships between two or more values, often used for financial analysis, to assess the performance, health, and prospects of a business.