A major constraint on consumer spending is deflation, which devalues money by reducing the products it can buy through persistent price increases.

Question

Quizplus · Accepted Answer

Deflation is characterized by a decrease in the general price level of goods and services, which increases the purchasing power of money, allowing consumers to buy more products for the same amount of money. Persistent price increases are actually a sign of inflation, not deflation.

A Major Constraint on Consumer Spending Is Deflation, Which Devalues