When the inflation rate goes up, the purchasing power of money:
A) increases.
B) decreases.
C) remains unchanged.
D) remains unchanged at first and then increases.

Question

Quizplus · Accepted Answer

When the inflation rate goes up, it means that prices are rising, which reduces the amount of goods or services you can buy with the same amount of money, hence decreasing the purchasing power of money.

When the Inflation Rate Goes Up, the Purchasing Power of Money