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26 November, 14:24

During hyperinflations,

A. money no longer functions as a good store of value and people may resort to barter transactions on a much larger scale.

B. middle-class savers benefit as prices rise.

C. money's value remains fixed to the price level; that is, if prices double so does the value of money.

D. the value of money rises rapidly.

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  1. 26 November, 17:33
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    A. money no longer functions as a good store of value and people may resort to barter transactions on a much larger scale.

    Explanation:

    Hyper Inflation can be defined as inflation i. e price rise occuring at highly accelerating pace.

    Such exponentially rising prices reduce the value (purchasing power) of money.

    So - people don't use it as a 'store of value' (saving for future purposes), since its future value is anticipated to be very lower. It is also used less as a 'medium of exchange' (transaction purposes), because of its less purchasing power.
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