in a scenario in which the economy is experiencing unanticipated inflation (greater than 5% as measured by the cpi), who would s

Question

Alchen [17]

2 years ago

13

in a scenario in which the economy is experiencing unanticipated inflation (greater than 5% as measured by the cpi), who would s

uffer the least negative impact?

SAT

1 answer:

Xelga [282] · Answer 1 · 2023-05-16T15:25:17+03:00

During inflation, investors who have assets in markets that are affected by inflation will have the least negative impact.

Inflation simply means the measure of the rate of the increase in the prices of goods and services in a country. Inflation can occur due to an increase in the factors of production or due to an increase in demand.

During inflation, the consumers are negatively affected as the price of goods soar. Despite the negative effects of inflation, it can still be beneficial to the investors that have assets in the markets that are affected by inflation.

Also, it can be beneficial for some companies that charge higher prices for the goods that they already have in their warehouse. This leads to more profit. In such a case, such people aren't really affected by the negative effects of inflation.

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