What is the "inflation tax"?
A) the difference between nominal and real interest rates received on financial assets, due to inflation
B) the fact that our tax system is based on nominal incomes and not real incomes, so that the government collects more taxes due to inflation alone
C) the government obtaining goods in exchange for newly created high-powered money that does not add to the real value of private assets due to the resulting inflation
D) the fact that greater government spending leaves fewer goods available to the private sector, thus lowering their prices.
C
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Refer to the scenario above. What is the nominal GDP of the economy in 2012?
A) $47,000 B) $56,000 C) $55,000 D) $49,500
Negative relationships are also referred to as inverse relationships
Indicate whether the statement is true or false
Why might well-educated economists disagree on appropriate public policy in some situations?
The general term for market structures that fall somewhere between monopoly and perfect competition is
a. incomplete markets. b. imperfectly competitive markets. c. oligopoly markets. d. monopolistically competitive markets.