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QuizMultiple Choice

Inflation and Stagflation

Question 2 of 10 • Economics - Pathways

Which scenario is an example of demand-pull inflation?

Answer
A
Consumers have more money to buy cars, and the prices of cars and car accessories rise as a result.
B
An increase in workers’ wages raises the production cost of cars, and car prices rise as a result.
C
The demand for cars falls as consumers have less disposable income, and car prices fall as a result.
D
A government bailout helps car manufacturers lower their costs, and car prices fall as a result.
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Which scenario is an example of demand-pull…