[Solved] Inflation redistributes income and wealth in favour of :

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Q.	Inflation redistributes income and wealth in favour of :
A.	Pensioners
B.	Poor
C.	Middle class
D.	Rich
Answer» D. Rich
Explanation: A group of economists including Keynes is of the opinion that 'inflation, in one form or the other, is a factor which helps economic growth. Usually, it is argued that inflation tends to redistribute income and wealth. The redistributive effect of inflation is always in favour of profit-earning class, that is to say, It redistributes income always from the wage- recipient class towards the profit-recipient class in the community. As a result, the saving ratio will increase because the marginal propensity to save of the profit earners is generally high as against the high margin-al propensity to consume of the wage- earners because of their near-subsistence level of income.

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