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High and Volatile Inflation Decreases Economic Efficiency Through All of the Following

Question 27

Multiple Choice

High and volatile inflation decreases economic efficiency through all of the following channels EXCEPT by


A) distorting incentives through interaction with the tax laws.
B) obscuring information transmitted by prices.
C) inducing people to minimize cash holdings.
D) reducing the purchasing power of cash holdings.
E) interfering with long-term planning.

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