Which costs of inflation could the government take action to reduce without reducing inflation?
A)shoeleather costs
B)unintended changes in tax liabilities
C)menu costs
D)none of the above is correct.

Question

Quizplus · Accepted Answer

The government can adjust tax brackets and deductions to reduce unintended changes in tax liabilities caused by inflation. However, shoe leather costs and menu costs are direct consequences of inflation and cannot be reduced without reducing inflation itself.

Which Costs of Inflation Could the Government Take Action to Reduce