Which of the Following Is NOT a Consequence of Unanticipated

question 1

Multiple Choice

Which of the following is NOT a consequence of unanticipated inflation?

• A) It increases the purchasing power of money.
• B) It reduces the value of future obligations.
• C) It increases uncertainty about the future.
• D) It reduces the incentives of firms to undertake investments.

---

Definitions:

Assets

Resources owned by a company that have economic value and can be used to meet its future obligations.

Liabilities

are legal financial debts or obligations that arise during the course of business operations.

Owner's Equity

The residual interest in the assets of a business after deducting liabilities, representing the ownership interest of shareholders or partners.

Liabilities

Financial obligations or debts owed by a business to outsiders, such as loans, accounts payable, or mortgages.