Some economists feel inflation is bad
A)because it reduces real GDP so much.
B)only if it is persistent.
C)because it redistributes income arbitrarily.
D)only if it is anticipated.

Question

Quizplus · Accepted Answer

Inflation can have a negative impact on the distribution of income, as it often leads to a decrease in the purchasing power of low- and fixed-income individuals, while those with higher incomes may have more resources to weather the effects of inflation. The other options are not completely accurate. Inflation does not necessarily reduce real GDP, and it can still be bad even if it is not persistent or anticipated.

Some Economists Feel Inflation Is Bad