What will make inflation less harmful?
A)if worker wages are set by long-term contracts
B)if it is correctly anticipated and interest rates adjust accordingly
C)if worker wages increase at the same rate as real growth
D)if interest rates are not adjusted accordingly when inflation occurs

Question

Quizplus · Accepted Answer

Correctly anticipating inflation and adjusting interest rates accordingly can prevent it from spiraling out of control and causing more harm to the economy. This can help keep inflation in check and reduce its negative impact. Option A is not a foolproof solution and may not be feasible in all situations. Option C may not be practical in the short term and may also not match the rate of inflation. Option D can actually exacerbate inflation and create more problems.

What Will Make Inflation Less Harmful