Who benefits the most during the inflationary period?

Options

A. debtors
B. creditors
C. entrepreneurs
D. government servants

Answer

C

Explanation

Inflation has the effect of redistributing income because prices of all factors do not decline in the same proportion. Entrepreneurs stand to gain more than wage earners or fixed income groups. Speculators, hoarders, black marketers and smugglers gain on account of windfall profits.