Question

Eleanor owns and operates a store in a country experiencing a high rate of inflation. Each day, some of her employees spend time tracking changes in the overall price level and changing the price tags within the store and the price lists on the store's website. This is an example of _______.

Answer 1

The given situation is an example of Menu costs of inflation

Step-by-step explanation:

Inflation is described as the sustained or persistent increase in the general cost of the goods over a period of time in an economy.

Menu costs is a cost of inflation and can be defined as the cost that results from price changes. With high inflation, firms change the prices of the goods and services to keep up with economy-wide changes. It includes printing new prices, re-tagging and developing pricing strategies.

The given situation is an example of Menu costs of inflation.