Which of the Following Is Not an Effect of Inflation

question 175

Multiple Choice

Which of the following is not an effect of inflation that is troublesome to consumers?

• A)Household incomes may be rising slower than the overall prices.
• B)The purchasing power of people's savings would decrease.
• C)Workers' wages may be rising faster than the overall price level.
• D)Their standard of living would fall if their household has a fixed nominal income.

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Definitions:

Legal Fees

Charges for services related to legal advice, representation, and legal document preparation by attorneys.

Delinquent Taxes

Taxes that have not been paid by the due date, often subject to penalties and interest charges.

Short-Term Note

A debt instrument or loan with a maturity of less than one year, often used for immediate financing needs.

Cost Basis

The original value or purchase price of an asset or investment for tax purposes, adjusted for stock splits, dividends, and return of capital distributions.