Answer: encourages investment by increasing the uncertainty about future returns
Step-by-step explanation:
Price inflation is the increase in general price level which brings about reduction in the purchasing power of economic agent such as the individuals or firms at a particular period of time.
Price inflation is important to individuals as it affects their decision making and it reduces their spending ability. Causes of inflation are due to excess demand, rise in production cost, rise in money supply etc. Financing wars isn't the main cause of inflation.
It should be noted that inflation encourages investment by reducing the uncertainty about future returns. This is because since prices of goods have already shoot up, investors will be encouraged as they'll like to invest in such economy as there'll be tendency to make maximize profit.