People Go to the Bank More Frequently to Reduce Currency

question 91

Multiple Choice

People go to the bank more frequently to reduce currency holdings when inflation is high.The sacrifice of time and convenience that is involved in doing that is referred to as

• A)inflation-induced tax distortion.
• B)relative-price-variability cost.
• C)shoeleather cost.
• D)menu cost.

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Definitions:

Voidable

A legal term referring to a contract or agreement that may be declared invalid by one of the parties due to issues like fraud or misrepresentation.

Contractual Capacity

The legal ability of an individual or entity to enter into binding contracts, requiring understanding and agreement to the contract's terms.

Principals

Individuals or entities that engage an agent to act on their behalf in transactions or negotiations.

Agency Relationship

A legal arrangement in which one party, the agent, is authorized to act on behalf of another, the principal, in business transactions.