Retirees and Creditors

question 64

Multiple Choice

Retirees and creditors:

• A) benefit from inflation because they are paid in cheaper dollars.
• B) benefit from inflation because interest rates rise.
• C) are hurt by inflation because their purchasing power drops.
• D) are hurt by inflation because taxes fall.

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Definitions:

Tariff Revenues

Income that governments earn from imposing taxes on the import and export of goods.

Export Subsidy

An export subsidy is a government policy to encourage export of goods and discourage sale within the domestic market, by providing financial assistance or tax relief.

Domestic Price

The price of a good or service within a country; this can be influenced by tariffs, taxes, and supply and demand.

Free Trade

An economic policy that allows imports and exports between countries with minimal or no tariff barriers.