In Zimbabwe, inflation rose from an annual rate of 32 percent in 1998 to 100,000 percent in early 2009. Considering only the effects of this unexpected inflation, which of the following is most harmed by the inflation?
A. Businesses with large inventories
B. Businesses with wages determined by long-term contracts
C. Businesses with large debts
D. Businesses who had contracted to sell their services to others at fixed prices
Answer: D
You might also like to view...
Why does the presence of negative externalities in the production of a good lead to an overproduction of the good?
What will be an ideal response?
Which of the following examples, ceteris paribus, would lead to a change in investment that would shift that nation’s aggregate demand curve?
a. Argentina’s government builds new highways. b. Portugal experiences a bout of high price levels. c. Spain’s government raises taxes on businesses. d. Mexico experiences high consumer debt levels.
If the marginal propensity to consume = 0.75, then:
A. the marginal propensity to save = 0.75. B. the marginal propensity to save = 1.33. C. the marginal propensity to save = 0.20. D. the marginal propensity to save = 0.25.
Cross-price elasticity looks at the impact that income changes have on sales.
Answer the following statement true (T) or false (F)