A modest inflation would help the car manufacturing industry compete with foreign car manufacturers because c. It could allow real wages to downwardly adjust more easily.
<h3>How would a modest inflation help with foreign competition?</h3>
When there is modest inflation, it means that the real wages paid to the employees in the car companies would fall.
This would reduce the real costs to the card companies in terms of producing cars. They will then be able to charge lower selling prices which would allow them to compete with cheaper imports.
Options for this question include:
a. The consumers of the cars have increased purchasing power.
b. Business loans would cost less for the U.S. car manufacturers.
c. It could allow real wages to downwardly adjust more easily.
Find out more on competing with foreign producers at brainly.com/question/24100924.
#SPJ12
