If an economy has a volatile in?ation rate:
A) uncertainty will increase making investment decisions di?cult.
B) net exports will rise since goods will be imported from other countries.
C) the business cycle will be relatively stable.
D) the government will pursue policies to shift aggregate supply to the left.

Question

Quizplus · Accepted Answer

Volatile inflation increases uncertainty in the economy, making it difficult for businesses and investors to make long-term investment decisions due to unpredictable costs and returns.

If an Economy Has a Volatile In?ation Rate