Suppose inflation is currently running at 15% and, as a result, sales catalogues have to be reprinted every month.This is an example of shoeleather costs.

Question

Quizplus · Accepted Answer

Shoeleather costs refer to the costs associated with the time and effort that people spend trying to counteract the effects of inflation, such as holding less cash and making more frequent trips to the bank. The example given is more accurately described as menu costs, which are the costs of changing prices (in this case, reprinting sales catalogues).

Suppose Inflation Is Currently Running at 15% And, as a Result