High and Unexpected Inflation Has a Greater Cost

question 203

Multiple Choice

High and unexpected inflation has a greater cost

• A)for those who save than those who borrow.
• B)for those who hold a little money than for those who hold a lot of money.
• C)for those whose wages increase by as much as inflation, than those who are paid a fixed nominal wage.
• D)for savers in low income tax brackets than for savers in high income tax brackets.

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Definitions:

Total Benefit

The sum of all the positive effects or satisfaction received by consuming a product or service.

Social Program

Initiatives created by governments aimed at providing support to citizens in areas such as healthcare, education, and income security.

Total Cost

The aggregate financial cost of all operating expenses and direct costs associated with the production of goods or services.

Total Benefit

The complete gain or satisfaction obtained from consuming a product or engaging in an activity, quantified by willingness to pay or perceived utility.