Question

Jack decided to save 10% of his annual earnings for 5 years so he could purchase a Tesla. After 5 years, what change in the economy would cause an increase in the purchasing power of the funds he has managed to save

Answer 1

Answer:

Deflation

Explanation:

A deflation is a fall in general price level.

When there is a deflation, things become cheaper and purchasing power increases.

Deflation is usually caused by a widespread fall in demand

For example, if there is a deflation, the price of the Tesla would fall and it would be relatively cheaper than it was 5 years ago.