During periods of rapid inflation, money may cease to work as a medium of exchange

Multiple Choice
unless it has been designated legal tender.
unless it is backed by gold.
because it is too scarce for everyone to have enough for transactions.

1 answer

During periods of rapid inflation, money may cease to work as a medium of exchange because it is too scarce for everyone to have enough for transactions.

However, it's important to clarify that in high inflation environments, the value of money decreases quickly, which can lead to hoarding of goods or an increase in barter transactions where money is not utilized effectively.