13
QuizMultiple Choice

Aggregate Economic Behavior and the Global Economy — Test

Question 13 • Economics

Which is the best definition of inflation?

Answer
A
a gradual increase in the price of goods and services
B
a gradual decrease in the price of goods and services
C
an exponential decrease in the price of goods and services
D
an exponential increase in the price of goods and services

Explanation

Inflation is a sustained, gradual rise in the general prices of goods and services over time. It means money buys less than before; it does not require prices to rise exponentially. Therefore, the best definition is “a gradual increase in the price of goods and services.”

AI-written and checked against the verified answer.

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