(Consider This) Deflation Is Most Likely to Occur

question 33

Multiple Choice

(Consider This) Deflation is most likely to occur

• A)during the expansionary phase of the business cycle.
• B)during the recessionary phase of the business cycle.
• C)when the central bank imposes negative nominal interest rates.
• D)when the inflation premium rises above 10 percent.

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Definitions:

Alpha-Galacturonic Acid

A component of pectin, a polysaccharide found in the cell walls of plants, involved in maintaining cell structure and rigidity.

Glucagon

A hormone produced by the pancreas that promotes the increase of blood glucose levels by stimulating glycogen breakdown in the liver.

Pectin

A complex carbohydrate found in the cell walls of plants that is often used as a gelling agent in foods and for its dietary fiber properties.

Hemicellulose

A polysaccharide found in plant cell walls that works with cellulose and lignin to provide structural support.