Question 37
Money and InflationAn indication that there is inflation in a country is that
- A.there is a decrease in the demand for goods and services.
- B.there are too many goods in circulation.
- C.the same amount of money buys lower quantity of goods.
- D.people prefer to lend than to borrow.
Show the answer and explanation
Answer: C (the same amount of money buys lower quantity of goods.)
Explanation
Inflation reduces what a given sum of money can buy.