ECONOMICS
INFLATION
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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a rapid increase in the quantity of money
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a sustained increase in prices in general
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too much money chasing too few goods
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a once-off increase in prices in general.
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Detailed explanation-1: -In economics, inflation is a sustained increase in the general price level of goods and services in an economy over a period of time. It is caused when increase in money supply and production falls. inflation results in rise in general price index.
Detailed explanation-2: -Inflation is the rate of increase in prices over a given period of time. Inflation is typically a broad measure, such as the overall increase in prices or the increase in the cost of living in a country.
Detailed explanation-3: -Sustained inflation is a period of continuous rising prices. The reason price rise are usually continuous is: Wage price spiral. If workers get rising wages, they spend more (demand-pull inflation) and increase costs for firms (Cost-push inflation). This causes inflation.
Detailed explanation-4: -Inflation is an increase in the level of prices of the goods and services that households buy. It is measured as the rate of change of those prices. Typically, prices rise over time, but prices can also fall (a situation called deflation).
Detailed explanation-5: -Conversely, deflation is a sustained decrease in the general price level in an economy.