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Anthony classically conditioned his cat to purr whenever the phone rang. One day, the phone rang for nearly two hours straight when Anthony wasn't home, and the cat's conditioned purring response underwent extinction. Today, the response has spontaneously recovered, but if the conditioned purring response were to undergo extinction again, Anthony should expect that it will
Shoeleather Costs
The increased costs of transactions caused by inflation, such as the time and effort spent to avoid holding onto cash that is rapidly losing value.
Redistributional Effects
The impact of policies or economic conditions on the distribution of income or wealth among the population, potentially altering inequality levels.
Unexpected Inflation
Unexpected inflation denotes the rate at which the general level of prices for goods and services rises, and subsequently, purchasing power falls, beyond what was anticipated.
Central Bank
The principal monetary authority of a country, responsible for regulating the money supply, issuing currency, and controlling interest rates.
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