Which of the Following Is Not an Example of Inflation

question 76

Multiple Choice

Which of the following is not an example of inflation causing a redistribution of income because the inflation was unexpected?

• A) Firms have to hire extra workers to change prices because of inflation.
• B) A firm signs a 4-year contract with a union based on a 3% expected rate of inflation per year, and the actual inflation rate ends up being 5% per year.
• C) An employee receives an increase in salary that is less than the rate of inflation because management under-predicted inflation.
• D) A bank collects a lower amount of interest from a loan because inflation was predicted to be 2% but was actually 4%.

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Definitions:

Secure-Avoidant

This might be a confusion with attachment styles, where "Secure" and "Avoidant" are different types; secure attachment is characterized by healthy relationships, whereas avoidant attachment involves keeping emotional distance.

Attachment Probing

The assessment or investigation of an individual's pattern of emotional bonds and relationship styles, stemming from early connections with caregivers.

Caregivers

Individuals who provide care and assistance to those in need, such as children, the elderly, or individuals with disabilities, often implying a personal bond or responsibility.

John Bowlby

A psychologist best known for his pioneering work in attachment theory.