ECON 2301 xe MyEagleECON 2302 SUmt ns Homework (ch o NCG 33809 MINDTAP From Ceng

Question

ECON 2301 xe MyEagleECON 2302 SUmt ns Homework (ch o NCG 33809 MINDTAP From Cengage Homework (Ch 30) Attempts: 7. Identifying costs of inflation Eric manages a grocery store in a country experiencing a high rate of inflation. He is paid in cash twice per month. On payday, he immediately goes out and buys all the goods he will need over the next two weeks in order to prevent the money in his wallet from losing value. What he can't spend, he converts into a more stable foreign currency for a steep fee. This is an example of the ? of inflation.

Explanation / Answer

Solution: Shoe-leather effect

Explanation: The shoe-leather costs refer to the effort and time people take for minimizing the inflation effect on the eroding purchasing power of money

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