Which of the following is not an economic cost of higher than anticipated inflation?
A)Purchasing power of people on fixed incomes will fall.
B)A person who has borrowed money at a fixed interest rate will be disadvantaged.
C)Businesses incur costs through having to change prices.
D)Banks who have loaned out money at a fixed interest rate will be disadvantaged.

Question

Quizplus · Accepted Answer

A person who has borrowed money at a fixed interest rate benefits from higher than anticipated inflation because the real value of the money they repay is less than the value of the money when they borrowed it.

Which of the Following Is Not an Economic Cost of Higher