Concept:Inflation means a sustained rise in the general price level of goods and services in an economy.
Explanation:When the price level rises, the same amount of currency can buy fewer goods and services.
As a result, each unit of currency loses real value over time.
Therefore, the purchasing power of money falls.
Workers' real incomes do not automatically increase because wages may stay unchanged while prices rise.
Borrowers and lenders cannot both benefit from inflation.
Inflation actually helps borrowers because they repay with money that has less real value, while lenders suffer a loss in purchasing power.
Among the options given, only the fall in money's purchasing power is the direct effect of inflation.
Answer:D. money's purchasing power will fall.