Most of the problems caused by inflation are caused by the fact that
A) there are no ways available for people to protect themselves against inflation.
B) anticipated inflation induces people to protect themselves against inflation.
C) inflation causes the purchasing power of the dollar to increase.
D) the inflation is often unanticipated and therefore comes as a surprise to individuals in the economy.

Question

Quizplus · Accepted Answer

Inflation, especially when unanticipated, can cause significant problems because individuals and businesses are unable to plan for the decrease in the purchasing power of money. This surprise element can lead to financial losses, reduced savings, and overall economic instability.

Most of the Problems Caused by Inflation Are Caused by the Fact