Use the figure below to answer the following questions.
Figure 12.2.6
-Refer to Figure 12.2.6.Starting at point A, the initial effect of a cost- push inflation is a move to point _______.As a cost- push inflation spiral proceeds, it follows the path _______.
A)C; E, H, I
B)B; D, G, I
C)E; I
D)C; B, H, G, I
E)B; E, G, I

Question

Use the figure below to answer the following questions.
  Figure 12.2.6
-Refer to Figure 12.2.6.Starting at point A, the initial effect of a cost- push inflation is a move to point _______.As a cost- push inflation spiral proceeds, it follows the path _______.
A)C; E, H, I 
B)B; D, G, I 
C)E; I 
D)C; B, H, G, I 
E)B; E, G, I

Quizplus · Accepted Answer

Cost-push inflation initially moves the economy from point A to B due to higher production costs leading to less output at higher prices. As the spiral proceeds, the economy moves through E, G, and finally I, reflecting ongoing adjustments in the economy to the inflationary pressures.

Use the Figure Below to Answer the Following Questions