Which of the following would cause stagflation?
A)rising government expenditures
B)rising oil prices
C)a falling money supply
D)technical progress

Question

Quizplus · Accepted Answer

Stagflation is a combination of stagnant economic growth and high inflation. Rising oil prices can cause supply shocks which increase the cost of production, leading to higher prices for goods and services. This can reduce economic growth while also causing inflation, resulting in stagflation. The other choices - rising government expenditures, falling money supply, and technical progress - do not necessarily lead to stagflation.

Which of the Following Would Cause Stagflation