Increases in the Quantity of Money Can Start a ____________Inflation

question 97

Multiple Choice

Increases in the quantity of money can start a ____________inflation and an increase in government expenditure can start a ____________inflation.

• A) cost-push; cost-push
• B) demand-pull; demand-pull
• C) demand-pull; cost-push
• D) cost-push; demand-pull

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Definitions:

Cognitive Bias

A systematic pattern of deviation from norm or rationality in judgment, where inferences about other people and situations may be drawn in an illogical fashion.

Availability Heuristic

A decision-making heuristic in which our estimates of frequency or probability of events are based on how easy it is to find examples.

Framing Effect

The influence of wording, or the context in which information is presented, on decision making.

Overconfidence

A cognitive bias where an individual’s subjective confidence in their judgments is greater than their objective accuracy.