Demand-pull inflation can start when
A) money wage rates rise but the price level does not change.
B) money wage rates rise faster than prices.
C) the short-run aggregate supply curve shifts rightward.
D) the aggregate demand curve shifts rightward.

Question

Quizplus · Accepted Answer

Demand-pull inflation is caused by an increase in aggregate demand. This is represented by a rightward shift of the aggregate demand curve. The other options either do not relate to demand-pull inflation or would not necessarily cause it.

Demand-Pull Inflation Can Start When