When does stagflation occur?
A)when real output rises and the price level rises
B)when real output falls and the price level falls
C)when real output rises and the price level falls
D)when real output falls and the price level rises

Question

Quizplus · Accepted Answer

Stagflation occurs when there is a simultaneous increase in the price level and a decrease in the level of real output. Option D signifies this scenario.

When Does Stagflation Occur