The More Rapidly the Government Creates Money to Finance Its

Multiple Choice

The more rapidly the government creates money to finance its budget deficits, the:

A) greater the inflation tax and the greater the reduction in the real value of any assets specified in nominal terms.
B) greater the inflation tax and the smaller the reduction in the real value of any assets specified in nominal terms.
C) smaller the inflation tax and the greater the reduction in the real value of any assets specified in nominal terms.
D) smaller the inflation tax and the smaller the reduction in the real value of any assets specified in nominal terms.