At the onset of the recent economic slowdown,prices at the grocery stores continued to rise.In some cases,products such as milk and bread almost doubled in price.In March 2008,a Boston newspaper reported,"The price of eggs was up 40% and milk was up 26%." Consumers were already being hit with high energy costs,and now their confidence in the economy was further shaken with job cuts and a loss of discretionary income due to increases in food prices.The economy was slowing,but prices were rising,signifying the potential for ___________.
A)deflation
B)stagflation
C)disinflation
D)equalization

Question

Quizplus · Accepted Answer

Stagflation is a condition in which an economy experiences stagnant growth and high inflation simultaneously. In this scenario, the economy was slowing down (stagnant growth) but prices were rising (high inflation), indicating the potential for stagflation. Deflation refers to a decrease in general price levels, disinflation is a decrease in the rate of inflation, and equalization is not a relevant term in this context.

At the Onset of the Recent Economic Slowdown,prices at the Grocery