It is often said that high rates of inflation tend to diminish people's incentive to save and invest. This view must be incorrect, however, because people generally saved and invested more of their income in the 1970's when inflation rates were high than they did in the 1980's when inflation rates were low.

Of the following, the best criticism of the argument above is that it overlooks the possibility that

all people do not respond in the same way to a given economic stimulus

certain factors operating in the 1980's but not in the 1970's diminished people's incentive to save and invest

the population was larger in the 1980's than it was in the 1970's

the proponents of the view cited would stand to gain if inflation rates become lower

a factor that affects people's savings behavior in a certain way could affect people's investment behavior quite differently


登录注册 后可以参加讨论