Question

Dmitri manages a grocery store in a country experiencing a high rate of inflation. He is paid in cash twice per month. On payday, he immediately goes out and buys all the goods he will need over the next two weeks in order to prevent the money in his wallet from losing value. What he can't spend, he converts into a more stable foreign currency for a steep fee. This is an example of the?

Answer 1

Shoe leather cost

Step-by-step explanation:

Dmitri manages a grocery store in a country experiencing a high rate of inflation. He is paid in cash twice per month. On payday, he immediately goes out and buys all the goods he will need over the next two weeks in order to prevent the money in his wallet from losing value. What he can't spend, he converts into a more stable foreign currency for a steep fee. This is an example of the shoe leather cost

Shoeleather cost is the cost of time and effort that individual spend trying to outwit the effects of inflation, this happens as result of trying hold less cash, investing in different currencies with lower levels of inflation, and having to make additional trips to the bank, so that your shoes weat out , which is where the name come from. This is what Dimitri is doing due to the high rate of inflation in his country.

Answer 2

shoe-leather costs

Step-by-step explanation:

Shoe-leather costs refers to the cost of time and effort that people spend trying to counter-act the effects of inflation, such as holding less cash and having to make additional trips to the bank. The term comes from the fact that more walking is required to go to the bank and get cash and spend it, thus wearing put shoes more quickly.