QuestionJuly 15, 2025

When there is high inflation rate in a country compared with other economies, the buying power of its currency is reduced, which leads to __ demand of that currency. a. less b. more c. constant d. no change

When there is high inflation rate in a country compared with other economies, the buying power of its currency is reduced, which leads to __ demand of that currency. a. less b. more c. constant d. no change
When there is high inflation rate in a country compared with other
economies, the buying power of its currency is reduced, which leads to
__ demand of that currency.
a. less
b. more
c. constant
d. no change

Solution
4.3(215 votes)

Answer

a. less Explanation 1. Analyze the effect of high inflation High inflation reduces the currency's purchasing power. 2. Determine demand impact Reduced purchasing power leads to **less** demand for that currency.

Explanation

1. Analyze the effect of high inflation<br /> High inflation reduces the currency's purchasing power.<br />2. Determine demand impact<br /> Reduced purchasing power leads to **less** demand for that currency.
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