A combination of declining real GDP and rising price level is referred to as
A)an expansion.
B)a trough.
C)stagflation.
D)deflation.
E)a depression.

Question

Quizplus · Accepted Answer

Stagflation refers to a situation where there is a combination of stagnation in economic growth (declining real GDP) and inflation (rising price level). It is characterized by high unemployment and high inflation, which is a unique phenomenon as inflation is typically associated with a strong economy.

A Combination of Declining Real GDP and Rising Price Level