If consumers,businesses,and government want to buy more than the full-employment level of output,the result is demand-pull inflation.

Question

Quizplus · Accepted Answer

When the total demand for goods and services exceeds the supply available at full employment level, demand-pull inflation occurs. This is because the excess demand leads to suppliers increasing the prices of the goods and services, resulting in inflation.

If Consumers,businesses,and Government Want to Buy More Than the Full-Employment