Which of the Following Statements About a Cost- Push Inflation

question 44

Multiple Choice

Which of the following statements about a cost- push inflation is correct?

• A) Cost- push inflation starts when an increase in aggregate demand "pushes" costs higher.
• B) The United States has never experienced a cost- push inflation.
• C) Cost- push inflation might start with a rise in the price of raw materials, but it requires increases in the quantity of money to persist.
• D) To persist, cost- push inflation needs a continual series of cost hikes with no change in aggregate demand.

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Definitions:

Restricted Fund Method

An accounting principle used by non-profit organizations, where donations or grants are kept in separate accounts and are spent only according to donors' stipulations.

Capital Fund

A financial resource that is used for the purchase of fixed assets or for significant investment in a business, not consumed in normal operations.

Restricted Contribution

A donation given to an organization with explicit limitations on its use by the donor.

Fixed Assets

Fixed assets, also known as non-current assets, are long-term tangible assets that are used in the operations of a business and are not expected to be consumed or converted into cash within a year.