Which of the following statements is true?
A) An individual living on a fixed income is always made better off as a result of deflation.
B) Those individuals receiving welfare benefits have been harmed by inflation because increases in welfare payments have not kept pace with inflation.
C) Inflation will have no effect on an individual whose income is indexed to the inflation rate.
D) Everyone in society benefits from inflation.

Question

Quizplus · Accepted Answer

Inflation can harm individuals on welfare if their benefits do not increase at the same rate as inflation, reducing their purchasing power.

Which of the Following Statements Is True