Suppose that the price level in Australia is expected to rise by 7% in 2016. (1 mark for each) Why do some economists claim that we should not worry

Suppose that the price level in Australia is expected to rise by 7% in 2016. (1 mark for each)

Why do some economists claim that we should not worry too much about inflation at this level?

Other economists think that there are significant costs associated with inflation above 2-3%. What are they?

What are the other costs be to consider if the inflation rate unexpectedly turns out to be higher than 7%?

Please help