For each of the following separate situations, determine the associated cost of inflation. (1) shoe-leather costs;...

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For each of the following separate situations, determine the associated cost of inflation. (1) shoe-leather costs;...

For each of the following separate situations, determine the associated cost of inflation.

(1) shoe-leather costs; (2) money illusion; (3) menu costs; (4) future price level uncertainty; (5) wealth redistribution; (6) price confusion; or (7) tax distortions.

(Explanations are not required)

Wages of computer scientists always rise because our economy needs more and more computer scientist over time.

business economics

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Answer 1

Answer #1

Wages of computer scientists always rise because our economy needs more and more computer scientist over time - Price confusion

(Reason: Increase in wage may be mistakenly attributed to an increase in demand, and not to the increase in price level)

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Answer 2

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