Deflation is defined as a decrease in:
A) the real wages of workers.
B) real GDP compared with the CPI.
C) the average price level of goods and services in the economy.
D) the price of all consumer products.

Question

Quizplus · Accepted Answer

Deflation is a decrease in the average price level of goods and services in the economy. It is the opposite of inflation, which is an increase in the average price level. Deflation can lead to lower profits for businesses and lower economic growth, as consumers postpone spending in anticipation of lower prices in the future.

Deflation Is Defined as a Decrease In