MEA-1.H—Explain the costs that unexpected inflation (deflation) imposes on individuals and the economy

Explain the costs that unexpected inflation (deflation) imposes on individuals and the economy.

• Unexpected inflation arbitrarily redistributes wealth from one group of individuals to another group, such as lenders to borrowers.
• Enduring understanding MEA-1: An economy’s performance can be measured by different indicators such as gross domestic product (GDP), the inflation rate, and the unemployment rate.