When the economy is experiencing high inflation and high unemployment at the same time,then it is experiencing:
A) stagnation.
B) deflation.
C) reflation.
D) stagflation.
E) innation.

Question

Quizplus · Accepted Answer

Stagflation is a term used to describe a situation where an economy experiences both high inflation and high unemployment at the same time. It is a challenging and rare economic condition as the traditional policy tools of monetary and fiscal policies may not be effective in addressing both issues simultaneously.

When the Economy Is Experiencing High Inflation and High Unemployment