Which of the following statements is incorrect?
A) If you can buy the same goods this year as you bought last year with less money there must have been deflation.
B) If you can buy the same goods this year as you purchased one year ago with the same amount of money, prices are stable.
C) If purchasing the same goods today that were purchased one year ago requires more money, there must have been inflation.
D) If you can buy the same goods this year as you bought last year with the same money there must have been deflation.

Question

Quizplus · Accepted Answer

The statement "If you can buy the same goods this year as you bought last year with the same money there must have been deflation" is incorrect because if prices remain constant, it does not necessarily indicate deflation. It could merely mean that prices have not changed.

Which of the Following Statements Is Incorrect