Demand-pull inflation persists because of
A)continuing increases in the real wage rate.
B)continuing increases in the quantity of money.
C)continuing increases in government expenditures.
D)continuing increases in aggregate supply.
E)continuing decreases in the money wage rate.

Question

Quizplus · Accepted Answer

Demand-pull inflation occurs when aggregate demand exceeds aggregate supply, leading to increases in prices. This can persist if there are continuing increases in the quantity of money in the economy, which fuels higher demand for goods and services. Options A, C, D, and E do not accurately explain the persistence of demand-pull inflation.

Demand-Pull Inflation Persists Because of