We know that money is the most liquid store of value due to many reasons except that

A. we do not have to convert it to make purchases.

B. it is the medium of exchange.

C. it saves purchasing power from the time income is received until the time it is spent.

D. money is exposed to the risks associated with hyperinflation.

Question

Business

Agustin Navarro

11 March, 16:31

We know that money is the most liquid store of value due to many reasons except that

A. we do not have to convert it to make purchases.

B. it is the medium of exchange.

C. it saves purchasing power from the time income is received until the time it is spent.

D. money is exposed to the risks associated with hyperinflation.

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Answers (1)

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Orlando · Answer 1

D is the correct answer.

Explanation:

Hyperinflation occurs when the prices of goods and services rise more than 50 percent in a month. With that rate, a commodity may cost less in the morning while its cost may increase too much by the evening. It starts when the government starts printing money to increase the money supply. Demand-pull inflation and the increase in money supply are the two reasons for inflation. When the demand is higher than supply the prices increases and inflation occurs. Four common types of inflation are Trotting inflation, Walking inflation, Galloping inflation, and stagflation.