The inflation tax falls mostly heavily on

Question

Quizplus · Accepted Answer

The inflation tax is a hidden tax that reduces the purchasing power of money held by individuals and businesses. Those who hold a lot of currency will be hit the hardest by inflation as the value of their money decreases over time. However, the inflation tax does not account for a large share of US revenue, so option A is not correct. Those who hold little currency may not be affected as much by the inflation tax, but they still contribute to the overall revenue of the country, so option C is not correct. Option D is also not correct because the inflation tax does account for a small share of US revenue, as noted earlier. Therefore, option B is the best choice as it correctly identifies the group that is most affected by the inflation tax but does not overestimate its contribution to US revenue.

The Inflation Tax Falls Mostly Heavily on