A big problem with using only the money supply as a leading indicator is that
A) money supply changes lag behind fiscal policy changes.
B) money supply changes are hard to implement.
C) there is more one money supply measure, and the different measures don't always move together.
D) money supply changes don't have much impact on the economy.

Question

Quizplus · Accepted Answer

There are multiple measures of money supply (such as M1, M2, M3, etc.), and these different measures can sometimes show divergent trends, making it difficult to use money supply as a singular leading indicator for economic forecasting or policy making.

A Big Problem with Using Only the Money Supply as a Leading