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One disadvantage of inflation is that?  

Economics
JAMB 2025

One disadvantage of inflation is that?

 

  • A. Standard of living rises
  • B. Fixed income earners lose
  • C. Fixed income earners gain
  • D. Businessmen lose
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Correct Answer: Option B
Explanation

Inflation is the rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is
falling. Central banks attempt to limit inflation, and avoid deflation, in order to keep the economy running smoothly. For fixed
income earners, inflation is a disadvantage because the purchasing power of their income decreases as prices rise.


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