Economists are in general agreement about what would need to occur in order to reach sustained inflation. What would need to happen?
A)The Federal Reserve would have to increase the money supply
B)The Federal Reserve would have to decrease the money supply
C)The government must decrease taxes
D)Credit card companies would have to issue more credit to consumers

Question

Quizplus · Accepted Answer

In order to reach sustained inflation, the Federal Reserve would have to increase the money supply.
Key Takeaway: Price increase-the only thing that can lead to sustained inflation-only occurs when the Federal Reserve partakes in policies that expand the economy and increase the AD. In order for our economy to reach sustained inflation, the Federal Reserve needs to keep increasing the money supply to keep the AD curve to the right.

Economists Are in General Agreement About What Would Need to Occur