As expected inflation falls for the coming year,we expected the price of gold to ________ due to a leftward shift the in ________ curve.
A) increase; demand
B) increase; supply
C) decrease; demand
D) decrease; supply

Question

Quizplus · Accepted Answer

When inflation falls, demand for gold typically decreases as investors have less reason to seek out a hedge against inflation. This will result in a leftward shift in the demand curve for gold, causing the price to decrease. Therefore, the best choice is C: decrease; demand.

As Expected Inflation Falls for the Coming Year,we Expected the Price