A period when overall inflation rates are positive but falling is called:
A) disinflation.
B) deflation.
C) inflation.
D) zero price level.

Question

Quizplus · Accepted Answer

Disinflation refers to a period when inflation rates are positive but decreasing. This can occur when the overall level of demand in the economy weakens or when the supply of goods and services increases rapidly. In other words, it means that the price level is still rising, but at a slower rate than before. Deflation is a period when overall prices are falling, inflation is a period when overall prices are rising, and zero price level refers to a hypothetical situation where all prices are constant (neither rising nor falling).

A Period When Overall Inflation Rates Are Positive but Falling