-In the above figure, the movement from point A to B to C to D to E represents
A) demand-pull inflation resulting solely from wage responses to excess labor demand.
B) demand-pull inflation resulting from persistent increases in the quantity of money.
C) cost-push inflation resulting solely from wage responses to excess labor demand.
D) cost-push inflation resulting from persistent increases in the quantity of money.

Question

-In the above figure, the movement from point A to B to C to D to E represents
A) demand-pull inflation resulting solely from wage responses to excess labor demand. 
B) demand-pull inflation resulting from persistent increases in the quantity of money. 
C) cost-push inflation resulting solely from wage responses to excess labor demand. 
D) cost-push inflation resulting from persistent increases in the quantity of money.

Quizplus · Accepted Answer

The movement from point A to B to C to D to E typically represents demand-pull inflation, which is often associated with persistent increases in the quantity of money. This type of inflation occurs when the overall demand for goods and services in an economy increases more rapidly than the economy's ability to produce, often influenced by an increase in the quantity of money in circulation.

-In the Above Figure, the Movement from Point a to B