Which of the Following Is NOT a Reason That Deflation

question 54

Multiple Choice

Which of the following is NOT a reason that deflation is considered a problem in an economy?

• A) Unexpected deflation redistributes wealth.
• B) There may be menu costs for reprinting restaurant menus and store price tags with lower prices.
• C) The purchasing power of fixed incomes rises.
• D) Unexpected deflation hurts borrowers, who must pay back dollars that are worth more than the dollars that they originally borrowed.

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Definitions:

Field Research

The collection of raw data outside of a lab, workspace, or controlled environment, often in its natural setting.

Descriptive

Pertaining to the detailed description of characteristics, behaviors, or phenomena, without attempting to influence or change them.

Experimental

Pertaining to a method of research in science that involves the manipulation of variables to test a hypothesis and observe the effects.

Confidence Interval

A statistical measure that provides, with a specified probability, a range of values within which a population mean is likely to lie.