Brian is paid monthly and typically takes $500 of his pay in cash to spend throughout the month, and the rest he leaves in an interest-bearing checking account. With the recent inflation, Brian finds it necessary to go to the bank every week, withdrawing $125 each time, so that his money can earn interest for as long as it can before Brian needs to withdraw it. The added hassle of going to the bank more often in response to inflation is called a:

Question

Quizplus · Accepted Answer

The added hassle of going to the bank more often in response to inflation is called a shoe-leather cost. This refers to the cost of time and effort required to make more frequent trips to the bank to withdraw money.

Brian Is Paid Monthly and Typically Takes $500 of His