Which of the following would serve to reduce the costs caused by the variability of inflation?
A)seignorage
B)bracket creep
C)a higher capital gains tax
D)indexed wages
E) none of the above

Question

Quizplus · Accepted Answer

Indexed wages would adjust automatically for inflation, reducing the costs caused by its variability. Seigniorage refers to the profits gained from printing money, and would not necessarily reduce the costs of inflation variability. Bracket creep refers to the phenomenon of inflation pushing taxpayers into higher tax brackets, and would not reduce the costs overall. A higher capital gains tax would not necessarily reduce inflation variability either.

Which of the Following Would Serve to Reduce the Costs