When Inflation Causes Relative-Price Variability

question 63

Multiple Choice

When inflation causes relative-price variability,

• A)consumer decisions are distorted and the ability of markets to efficiently allocate factors of production is impaired.
• B)consumer decisions are distorted,but markets are still able to efficiently allocate factors of production.
• C)consumer decisions are not distorted,but the ability of markets to efficiently allocate factors of production is impaired.
• D)consumer decisions are not distorted and markets are still able to efficiently allocate factors of production.