Answered

What are the signs of high inflation? Check all that apply.

A. Production begins to fall.
B. Production begins to rise.
C. Interest rates decrease.
D. Interest rates increase.
E. Purchasing power falls.
F. Fewer fixed-rate bank loans.



Answer :

GinnyAnswer

Final answer:

Inflation causes purchasing power to fall when prices rise. Signs of high inflation include a decrease in production, purchasing power, and an increase in interest rates.


Explanation:

Inflation occurs when the price of goods and services rises, causing purchasing power to fall if wages do not increase proportionally. High inflation signs include a decrease in production, a decrease in purchasing power, and interest rates increase. These factors can impact individuals holding cash or investments not keeping up with inflation.


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