Question 4 (1.25 points) Which of the following do shoe leather costs of inflation refer to? O the distortion in resource allocation created by distortions in relative prices due to inflation O resources used to maintain lower money holdings when inflation is high the cost of more frequent price changes induced by higher inflation the distortion in incentives created by inflation by taxes that do not adjust for inflation Question 5 (1.25 points) Suppose a Mexican company purchases tractors from a Canadian company and pays for it with domestic currency. What are the effects of this transaction? It increases Canadian net exports and increases Mexican net capital outflow. O It increases Canadian net exports and decreases Mexican net capital outflow. O It decreases Canadian net exports and increases Mexican net capital outflow. It decreases Canadian net exports and decreases Mexican net capital outflow