Inflation Reduces Economic Efficiency Because It Does Each of the Following

question 92

Multiple Choice

Inflation reduces economic efficiency because it does each of the following except:

• A)distort incentives through interaction with the tax laws.
• B)obscure information transmitted by prices.
• C)induce people to minimize cash holdings.
• D)change relative prices.

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Definitions:

Fallopian Tubes

Tubes that extend from the uterus to the ovaries, providing the path for an egg to travel during ovulation.

Spermatogenesis

The process of sperm cell development, occurring in the testes of males.

Spermatocytes

Cells in the testes that undergo meiosis to produce sperm.

Spermatids

Immature male sex cells that result from the division of secondary spermatocytes and will eventually develop into mature sperm.