Which of these would NOT cause inflation in the United States?
A) The Great Plains experiences a severe drought.
B) The stock market reaches new highs.
C) Severe flooding ruins crops throughout the Midwest.
D) The federal government runs a budget surplus.

Question

Quizplus · Accepted Answer

Running a budget surplus means that the government is collecting more revenue than it is spending. This would lead to a decrease in the money supply, which would actually cause deflation rather than inflation. The other options (A, B, and C) could all potentially lead to inflation as they can cause a decrease in the supply of goods, leading to an increase in prices.

Which of These Would NOT Cause Inflation in the United