Which of the following will be the outcome if an economy is under inflationary pressure?
1. Domestic currency heads towards depreciation.
2. Exports b

Question

Which of the following will be the outcome if an economy is under inflationary pressure?
1. Domestic currency heads towards depreciation.
2. Exports become less competitive and imports become costlier.
3. Cost of borrowing decreases.
4. Bondholders benefit.
Which of the statement(s) given above is/are correct?

Accepted Answer

(C) 1 and 3

Answer

(A) 1 and 2

Answer

(B) 2 and 4

Answer

(D) 1, 3 and 4