Which of the following statements is FALSE?
A) When unanticipated inflation occurs regularly, the degree of risk associated with investments in the economy increases.
B) Inflation that is higher than expected benefits debtors, and inflation that is lower than expected benefits creditors.
C) 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.
D) There are no costs or losses associated with correctly anticipated inflation.

Question

Quizplus · Accepted Answer

Correctly anticipated inflation still incurs costs, such as menu costs and shoe leather costs, even if it is expected.

Which of the Following Statements Is FALSE