Consequences of Economic and Monetary Instability

The Impact of Economic and Monetary Instability

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Question

An unfortunate consequence of ________ and monetary instability is that people spend less time producing and more time trying to protect their wealth.

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Explanations

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A. B. C. D. E.

Explanation

Since failure to anticipate the rate of inflation has substantial effects on one's wealth, individuals divert scarce resources away from the production of goods and services and apply them into the acquisition of business decision makers to forecast the price changes. Thus, speculative practices are encouraged while productive activities are discouraged.

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