Which of the Following Is Correct About Inflation

question 26

Multiple Choice

Which of the following is correct about inflation?

• A) If inflation is 7% and your rate of return in your savings account is 4%, you will experience an overall gain in buying power.
• B) As inflation rates increase, interest rates offered to savers decrease.
• C) Inflation does not affect interest rates for savings accounts.
• D) In order to increase buying power, you need to earn a rate higher than the rate of inflation.
• E) If you earn 5% and inflation is 10%, your buying power will increase.

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Definitions:

Cause Of Action

A set of facts or legal basis that enables one party to sue another.

Province

A principal administrative division of certain countries, especially in Canada, which is characterized by its own government and boundaries.

Defendant Resides

The legal jurisdiction or location where the defendant (the person accused in a lawsuit) lives or is based.

Garnishment

A court order that monies owed to the judgment debtor (defendant) by third parties be paid into court and applied toward judgment debts; also known as attachment of debt.