A substantial reduction in the rate of inflation is called
A) deflation.
B) disinflation.
C) negative inflation.
D) hyperinflation.
E) stagflation.

Question

Quizplus · Accepted Answer

A substantial reduction in the rate of inflation is called disinflation. This means that there is still inflation, but at a slower rate. Deflation, on the other hand, means a decrease in overall prices, and negative inflation is not a valid term. Hyperinflation refers to an extreme, out-of-control inflation rate, and stagflation is a combination of high inflation and low economic growth.

A Substantial Reduction in the Rate of Inflation Is Called