Demand-pull inflation is the result of:
A) high aggregate demand.
B) low aggregate demand.
C) favorable supply shocks.
D) adverse supply shocks.

Question

Quizplus · Accepted Answer

Demand-pull inflation occurs when there is a high level of aggregate demand in the economy. This can be caused by factors such as low interest rates, high levels of government spending, or an increase in consumer confidence. As demand for goods and services increases, prices rise due to the scarcity of these goods and services.

Demand-Pull Inflation Is the Result Of