Which of the following is NOT a cost of anticipated inflation but arises only if inflation is unanticipated?
A. Inflation interacts with the tax system to hurt savings and investment in physical capital.
B. Inflation represents an implicit tax on holding money.
C. Firms face menu costs of changing prices.
D. Higher inflation leads to greater uncertainty about the future inflation rate.
Answer: D
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Answer the following statement true (T) or false (F)