If a Nation Experienced an Inflation Rate of About 12

question 116

Multiple Choice

If a nation experienced an inflation rate of about 12 percent and then,five years later,had an inflation rate of about 5 percent,which of the following statements best describes what was happening to purchasing power during the period?

• A) The purchasing power of businesses did not see a change throughout the period,but consumers did.
• B) The average consumer's purchasing power was lower at the beginning of period than at the end.
• C) The country was experiencing a recession,prices were universally high throughout the period,and purchasing power declined for everyone.
• D) The average consumer's purchasing power was higher at the beginning of the period than at the end.

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Definitions:

Physical Distribution

The process of transporting and handling goods from production points to the places where they are consumed or used.

Place Utility

The value added to goods through changes in their location, making them more accessible or convenient for consumers.