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Costs of Inflation: Shoe-leather Costs and Menu Costs
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Problem 10
Costs of Inflation: Shoe-leather Costs and Menu Costs
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12. Unemployment and Inflation / Costs of Inflation: Shoe-leather Costs and Menu Costs / Problem 9
Problem 9
Why do menu costs increase during hyperinflation?
A
Because businesses must frequently update prices to reflect rapid inflation.
B
Because hyperinflation eliminates the need for price changes.
C
Because businesses stop updating prices during hyperinflation.
D
Because hyperinflation stabilizes prices, reducing menu costs.
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