Question

If the rate of inflation is higher than your interest rate on your savings account you are gaining buying power. true. false.

Answer 1

false I believe, inflation is pretty bad cause, you have to spend more than what your suppose to be spending, like a cup of coffee is ex(2.45 with inflation that would have raised to $5-9)

Answer 2

If inflation rates are so high that they are higher than your savings account interest rate, then you lose buying power. This statement is therefore false.

What happens when inflation is high?

If inflation is higher than the rate of return you recieve on your savings account, then you would be losing your buying power.

Simply put, if prices are rising faster than you are gaining returns on your savings, you will only be able to buy less things.

In conclusion, this is false.

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