List Two Costs of Inflation

question 28

Short Answer

List two costs of inflation.

---

Definitions:

Trade Gains

The benefits that countries obtain from engaging in international trade, often reflected in improvements in economic welfare, efficiency, and resource allocation.

Supply-side Shocks

Unexpected events that affect the supply side of the economy, potentially altering the cost of production and leading to changes in prices and output.

Consumer Spending

The total expenditure by households and individuals on goods and services within a country's economy.

Economic Fluctuations

The rise and fall of economic activity relative to the long-term growth trend of the economy; also called business cycles