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Macro or Micro: Effect of an increase in inflation rate on households' decision to save or spend money

User Bocercus
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Final answer:

An increase in inflation rate can affect households' decisions to save or spend money.

Step-by-step explanation:

This question pertains to macroeconomics, a subfield of economics that examines the behavior and performance of an economy as a whole. An increase in inflation rate is a macroeconomic factor that can affect households' decisions to save or spend money. When inflation increases, the value of money decreases over time, leading to a decrease in purchasing power. As a result, households may choose to save more money to maintain their standard of living.

User Nick Palmer
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