0
Economists often refer to inflation as the "hidden tax" on consumers. Why is inflation the hidden tax? Inflation causes saved money to have less value over time. Money that is earned today has greater purchasing power than it will in the future once the force of inflation has caused goods and services to have higher prices. Money must be interested in interest earning investments if one wishes to curb inflation to some degree.
What else can I help you with?
How did the severe inflation in Germany affect the population?
For Millions of Germans, a lifetime's worth of hard work and savings had vanished!
How would the inflation rate affect the hotel and restaurant industry in the Philippines?
The behavior (rise or fall) of the inflation rate directly affects consumer spending, and indirectly the hotel and restaurant industry.
How will inflation affect hospitality industry in Nigeria?
how does inflation affect hospitality in nigeria industry
How would inflation affect any society?
Runaway inflation makes people want to spend their money now and buy durable goods like gold, houses and cars. Saving money is pointless. People with fixed incomes lose. People with money saved lose. Inflation robs people of their savings. People who owe money win.
How do interest rates and inflation affect real estate in south Africa?
explain how do intrest rates and inflation affect the real estate
How will the weather affect the inflating of the balloons?
how will the weather affect the inflation of the ballooons
Was the ATM the answer to inflation?
No. The ATM does not in any way affect or answer inflation. It is just a machine through with customers can do banking transactions without visiting their bank. It does not cause or affect inflation. Only the country's central bank can control inflation by changing regulatory policies.
What does inflation do to real income?
Inflation erodes the purchasing power of money, meaning that as prices rise, the same amount of income buys fewer goods and services. Consequently, if nominal income remains unchanged while inflation increases, real income declines, leading to a decrease in the standard of living. This effect can disproportionately impact those with fixed incomes, as their earnings do not adjust with rising prices. Overall, sustained inflation can negatively affect consumer spending and economic stability.
What are the economic and political factors that affect the Philippines economic growth?
Economic factors that affect the Philippines' economic growth include inflation rates, exchange rates, fiscal policies, and infrastructure development. Political factors such as stable governance, corruption levels, and policy consistency also play a significant role in influencing the country's economic growth trajectory.
How do IRA contributions affect Social Security benefits when collecting?
IRA contributions do not directly affect Social Security benefits when collecting. Social Security benefits are based on your earnings history, while IRA contributions are separate retirement savings that do not impact the amount of Social Security benefits you receive.
How does increased stock prices affect the nation?
Inflation!
What organization most affect the money supply?
inflation
