Despite its costs, governments typically resist eliminating inflation because
A)doing so would result in lost output and jobs when the economy is near full employment.
B)the increase in menu costs because of inflation increases the governments' tax revenues.
C)as net lenders, governments benefit from inflation.
D)governments lack the knowledge of how to eliminate inflation.

Question

Quizplus · Accepted Answer

Eliminating inflation can result in lost output and jobs when the economy is near full employment. Therefore, governments resist doing so.

Despite Its Costs, Governments Typically Resist Eliminating Inflation Because