Cost-Push Inflation Corresponds to ________ Output and Demand-Pull Inflation Corresponds

question 198

Multiple Choice

Cost-push inflation corresponds to ________ output and demand-pull inflation corresponds to ________ output.

• A) higher; higher
• B) higher; lower
• C) lower; higher
• D) lower; lower

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Definitions:

Price Floor

A government or group-imposed minimum price set above the equilibrium price, ensuring sellers cannot charge less than this amount.

Market-clearing Price

The price at which the quantity supplied of a product equals the quantity demanded, effectively clearing the market of any surplus or shortage.

Pumpkins

A type of squash plant known for its round, orange fruit used primarily for decoration, cooking, and as a symbol of Halloween.

Price Ceilings

A maximum price legally allowed for a product or service to safeguard the interests of consumers.