Consider the following statements 1 Inflation redistributes wealth from creditors to debtors 2 Highe...........

Economic Affairs Inflation

Download Solution PDF

Consider the following statements:-

1) Inflation redistributes wealth from creditors to debtors.

2) Higher inflation suggests that producers should produce more.

Mark the correct one(s):-

Only 1

Only 2

Both 1 and 2

Neither 1 nor 2

छोटे Courses बड़े Results

Master Inflation

Prepare through Micro-courses

Try Now

Explanation:

Inflation is the general price rise of commodities for a specific time period. Inflation redistributes wealth from creditors to debtors means lenders suffers and borrowers benefit. The opposite effect takes place during deflation.Inflation indicates rise in aggregate demand so more production is required.