Assuming That GDP Currently Equals Potential GDP, a Cost-Push Inflation

question 357

Multiple Choice

Assuming that GDP currently equals potential GDP, a cost-push inflation could result from which of the following?

• A) an increase in the nationʹs capital stock
• B) a large crop failure that boosts the prices of raw food materials
• C) an increase in the labor force
• D) a decrease in tax rates

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