Inflation Redistributes Income to a Greater Extent When the Inflation

question 65

True/False

Inflation redistributes income to a greater extent when the inflation is 'unanticipated'.

---

Definitions:

Temporary Surplus

A short-term situation where the supply of a product or service exceeds its demand, often leading to price reductions.

Permanent Surplus

A situation where a country consistently exports more goods and services than it imports, leading to a positive balance of trade over time.

Equilibrium Price

The price at which the quantity of a product or service demanded by consumers matches the quantity supplied by producers, leading to a balance in the market.

Equilibrium Quantity

The amount of products or services that are available and sought after at the market's balance price.