Which of the following is a change that would NOT start a demand- pull inflation?
A) an increase in government expenditures on goods and services
B) an increase in labor productivity
C) an increase in the quantity of money
D) an increase in exports

Question

Quizplus · Accepted Answer

An increase in labor productivity would result in a decrease in production costs, which would not create an increase in demand for goods and services leading to demand-pull inflation. On the other hand, options A, C, and D would create an increase in demand for goods and services, leading to demand-pull inflation.

Which of the Following Is a Change That Would NOT