TOLFA Segment 7, Question 5

Is inflation a tax? Why, or why not? Of course not. Inflation is when prices rise, and that's caused by greedy merchants and manufacturers.
No. Whatever causes it, inflation hits government buyers just as everyone else.
Certainly it is. Government prints more money to pay its bills, and after some months everyone else has to pay higher prices for everything. The government gains, the people lose. That's a tax.
No. It's a banking manoever, operated by the Federal Reserve, and isn't connected with taxes.

Don't hurry away; even when you've got the right answer, try clicking on the others to see why they are wrong! Then when you have correctly answered this make notes in your student notebook, then go to Question 6.

Segment 7 Page