Inflation brings most benefits to which one of the following?

Government pensioner

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Creditors

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Saving bank account holder

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Debtors

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Solution

The correct option is A Debtors
In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. It is caused when increase in money supply and production falls. Inflation brings most benefits to debtors because people seek more money from debtors in order to meet the increased prices of commodities.

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Similar questions

27) Consider the following statements:

i) Inflation benefits the debtors.

ii) Inflation benefits the bondholders.

Which of the statements given above is/are correct?

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