Inflation is harmful to society because it often
a. causes consumers' purchasing power to decline
b. causes sellers' costs to increase
c. causes nominal wages to fall
d. causes purchasing power to be redistributed in haphazard ways
e. has no effect at all on anyone's purchasing power
D
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Unanticipated expansionary monetary policy will increase economic growth and push inflation upward while lowering real interest rates. This will cause
a. an increase in the demand for foreign currencies and a decline in the foreign exchange value of the dollar. b. a decrease in the demand for foreign currencies and a decline in the foreign exchange value of the dollar. c. an increase in the demand for foreign currencies and an increase in the foreign exchange value of the dollar. d. a decrease in the demand for foreign currencies and an increase in the foreign exchange value of the dollar.
When a corporation uses profits to pay for the purchase of new capital equipment, this is known as
A) reinvestment. B) a coupon payment. C) dividend. D) collusion.