Other things being equal, if input prices rise in a country, then there would be
A)cost-push inflation.
B)demand-pull inflation.
C)cost-push deflation.
D)more production and a lower price level.

Question

Quizplus · Accepted Answer

When input prices rise, the cost of production for firms increases. As a result, firms would increase their prices to maintain their profit margins. This leads to an increase in the general price level, known as cost-push inflation.

Other Things Being Equal, If Input Prices Rise in a Country