If Inflation Is Highly Volatile, Money Is

question 5

Multiple Choice

If inflation is highly volatile, money is:

• A)more valuable because you need more of it.
• B)less valuable because there is less of it.
• C)more valuable because its unit of account function is reduced.
• D)less valuable because its unit of account function is reduced.

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Definitions:

Personal Liabilities

Debts or obligations that an individual is responsible for, as opposed to those belonging to businesses or governmental entities.

Limited Partners

Investors in a partnership who have limited liability to the extent of their investment in the partnership. They do not partake in the day-to-day management of the business.

Limited Liability

A legal structure that limits the personal financial risk for shareholders of a company to the amount they invested in the company.

Trade Deficits

An economic condition that occurs when a country imports more goods and services than it exports.