A demand-pull inflation is initially characterized by
A) increasing real output and a labor shortage.
B) increasing real output and a labor surplus.
C) decreasing real output and a labor shortage.
D) decreasing real output and a labor surplus.

Question

Quizplus · Accepted Answer

Demand-pull inflation is characterized by increasing real output and a labor shortage, as rising demand for goods and services pulls prices up, often leading to more hiring and thus a shortage of available labor.

A Demand-Pull Inflation Is Initially Characterized by