The government's common solution for runaway inflation is to increase ________.

Question

Quizplus · Accepted Answer

The government's common solution for runaway inflation is to increase unemployment. This is done as a means of reducing the money supply, which helps to combat inflation. When there is less money available in the economy, prices tend to stabilize or decrease. Increasing government spending or subsidies could potentially fuel inflation rather than combat it. Investments may have little impact on inflation in the short-term.

The Government's Common Solution for Runaway Inflation Is to Increase