Author Question: Why does inflation cause problems in a society? A) It gives people an incentive to hold money ... (Read 110 times)

jjjetplane · **on:** Jun 29, 2018

Why does inflation cause problems in a society?

A) It gives people an incentive to hold money rather than spend it and provide income for others.
B) It makes everything more expensive in real terms.
C) People aren't able to anticipate it accurately.
D) The cost of living rises for almost everyone in an inflation.
E) For all of the above reasons.

Question 2

In an economy that did not use money, but in which barter was exclusively employed for the exchange of goods, inflation

A) could not occur.
B) would be almost entirely the result of speculation.
C) would benefit buyers more than sellers.
D) would redistribute real income rather than money income.
E) would strike hardest at those on fixed incomes.