Which of the Following Is True About Inflation

question 62

Multiple Choice

Which of the following is true about inflation?

• A)Inflation promotes social harmony by uniting people against the government.
• B)Inflation is more damaging if it is unanticipated.
• C)Accurate anticipation of inflation is possible for everyone who is well informed about economic events.
• D)Those who lend money at a rate above the rate of inflation suffer economic losses.
• E)If people accurately anticipate inflation,their actions will prevent it.

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Definitions:

Incremental Annual

Refers to the additional yearly impact or benefits resulting from a specific decision or action.

Payback Period

The length of time required to recover the cost of an investment.

Required Rate

The minimum expected rate of return on an investment, project, or loan, often used in evaluating its viability.

Net Operating Income

A measure of a company's profitability from its core business operations, calculated by subtracting operating expenses from revenue, excluding non-operating items such as interest and taxes.