Disinflation occurs when:
A) the inflation rate is negative.
B) the inflation rate is 2 percent or less.
C) the inflation rate goes above ten percent.
D) the rate of inflation declines.

Question

Quizplus · Accepted Answer

Disinflation refers to the decrease in the rate of inflation, i.e. when the rate of inflation declines. Therefore, option D is the correct answer. Options A and C are incorrect as they refer to negative and high levels of inflation respectively, while option B is incorrect as it is too specific and not necessarily indicative of disinflation.

Disinflation Occurs When