Which of the following statements is false?
A)Whether you gain or lose during a period of inflation depends on whether your income rises faster or slower than the prices of things you buy.
B)Inflation that is higher than expected benefits debtors and inflation that is lower than expected benefits creditors.
C)When unanticipated inflation occurs regularly, the degree of risk associated with investments in the economy increases.
D)There are no costs or losses associated with inflation when it is fully anticipated.

Question

Quizplus · Accepted Answer

This statement is false. There are costs and losses associated with inflation even when it is fully anticipated. These include menu costs, shoe-leather costs, and uncertainty about future inflation rates.

Which of the Following Statements Is False