What is the difference between disinflation and deflation?
A) Disinflation is a slower increase in prices, whereas deflation is a decrease in prices.
B) Deflation is a slower increase in prices, whereas disinflation is a decrease in prices.
C) The Fed can engineer disinflation, but not deflation.
D) There is no difference between disinflation and deflation.

Question

Quizplus · Accepted Answer

Disinflation refers to a situation where the rate of inflation slows down, meaning prices are still increasing but at a slower rate. Deflation is when prices actually start to decrease.

What Is the Difference Between Disinflation and Deflation