Which of the following will cause an increase in cost of production?
ECONOMICS
JAMB 2023
Which of the following will cause an increase in cost of production?
- A. Hyper-inflation
- B. Cost push inflation
- C. Structural inflation
- D. Demand pull inflation
Correct Answer: B. Cost push inflation
Explanation
Cost push inflation occurs when overall prices increase(inflation) due to increases in the cost of wages and raw materials. It can also occur when higher costs of production decrease the aggregate supply in the economy.
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