If inflation were always perfectly anticipated, then
A) its real costs would exactly equal the inflation rate
B) people would hold less cash but would still suffer losses since money balances are always positive
C) the yield on interest-bearing assets would exactly compensate for losses on non-interest bearing assets
D) unemployment would always be at 4 percent
E) wage indexation would not work
Correct Answer:
Verified
Q1: If you had $1,000 in a savings
Q3: If inflation this year is higher than
Q4: Which of the following is TRUE?
A)the costs
Q5: If inflation were always perfectly anticipated and
Q6: If a one-year bond pays a fixed
Q7: Which of the following is TRUE, if
Q8: If this year's inflation rate was lower
Q9: The concern over inflation
A)is not justified since
Q10: The unanticipated inflation of the last several
Q11: The menu cost of inflation arises since
A)people
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