Which of the following could trigger supply-side inflation?

Question

Quizplus · Accepted Answer

An increase in raw materials' prices can lead to an increase in the cost of production for firms, which can lead to an increase in prices for consumers. This is an example of supply-side inflation, as it is caused by a decrease in the supply of goods due to increased production costs. The other choices do not necessarily lead to supply-side inflation. A decrease in the wage rate for all workers could lead to a decrease in production costs, which could lead to lower prices for consumers. An increase in the productivity of capital could lead to increased production and lower prices for consumers. An increase in the labor force could lead to increased production, which could also lead to lower prices for consumers if demand remains constant.

Which of the Following Could Trigger Supply-Side Inflation