How can hyperinflation affect people and their decisions? Choose two correct answers.It improves consumer spending.It makes it easier to buy food and other basic goods.It means people are unable to borrow money.It increases the value of people’s bank accounts.It makes it difficult to buy food and other basic goods.
Answer
A
It improves consumer spending.
B
It makes it easier to buy food and other basic goods.
C
It means people are unable to borrow money.
D
It increases the value of people’s bank accounts.
E
It makes it difficult to buy food and other basic goods.
Explanation
Hyperinflation makes prices rise extremely quickly, so money loses purchasing power and people may struggle to afford food and other basic goods. It also makes borrowing difficult because lenders face great uncertainty about how much money they will be repaid in real value. The correct choices are “It means people are unable to borrow money” and “It makes it difficult to buy food and other basic goods.”
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