Demand-pull inflation can be as a result of___________
ECONOMICS
WAEC 2021
Demand-pull inflation can be as a result of___________
- A. increase in the cost of production.
- B. excessive supply of foodstuff
- C. deficit financing by the government.
- D. increase in import duties
Correct Answer: C. deficit financing by the government.
Explanation
Demand-pull inflation is when there is an increase in aggregate demand, and the supply remains the same or decreases. Demand-pull inflation can be caused by an expanding economy, increased government spending, or overseas growth.
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