Multiple choice

The best means of saving during inflation is to keep

  1. money in bank

  2. equity

  3. bonds

  4. debentures
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

It is easy to suggest that one may park the funds in equity. In times of inflationary turbulence, there could be greater uncertainty in equity returns, which, in any case, are not sure guarantees. The best way to hedge against inflation is to park funds in saving instruments that offer interest rates in excess of the average rate of inflation. 

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