If a Rise in Anticipated Inflation Produces for Some Reason

question 83

Multiple Choice

If a rise in anticipated inflation produces for some reason a less-than-equal rise in the nominal interest rate,this ________ the costs of anticipated inflation by ________ saving.

• A)reduces,encouraging
• B)reduces,discouraging
• C)increases,encouraging
• D)increases,discouraging

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Definitions:

Highest Price

the maximum price at which a good or service is sold in the market or the highest price a buyer is willing to pay.

Unconsummated Transaction

A transaction that is proposed but not finalized or completed.

Tax Rate

The percentage at which an individual or corporation is taxed on earned income, investments, or properties.

Buyer Surplus

The difference between the buyer’s value (what he is willing to pay) and the price (what he has to pay).