Demand- pull inflation persists because of

Question

Quizplus · Accepted Answer

Demand-pull inflation occurs when there is an increase in the quantity of money in an economy. As the money supply increases, consumers have more money to spend, which leads to an increase in demand for goods and services. This increase in demand leads to higher prices, as businesses respond to the increased demand by raising prices to maximize profits. Therefore, continuing increases in the quantity of money contribute to the persistence of demand-pull inflation.

Demand- Pull Inflation Persists Because of