If All Prices Experience an Increase of 4 Percent in One

question 131

Multiple Choice

If all prices experience an increase of 4 percent in one year, then which of the following is necessarily true?

• A) The rate of inflation for that year is 4 percent.
• B) The level of consumer demand is higher in that year as compared to the previous year.
• C) The average unemployment level has increased.
• D) The output of the economy has fallen by 4 percent in that year.

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