n NISM Certifications
X NISM Series X
Medium

Inflation increases the amount of money required during retirement because rising prices mean that the same level of expenses will need more funds over time to maintain the same standard of living.

Practice question from NISM Series XB- Investment Adviser (Level 2) Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Increases the value of the corpus created

  2. B

    Reduces the periodic savings required

  3. Increases the retirement corpus required

    Correct answer

  4. D

    Reduces the nominal return generated by an investment

Why this is the answer

Inflation causes the cost of living to rise, thereby necessitating a larger retirement corpus to cover future expenses adequately.

Test yourself for real

Take a full NISM Series X mock test.

Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.