Which of the Following Led to Inflation in the United

question 59

Multiple Choice

Which of the following led to inflation in the United States in the early 1970s?

• A)The United States borrowed tremendous amounts of money to balance its budget.
• B)The United States increased its import tariffs, which damaged its trade relations with other nations.
• C)The United States' government comprised corrupt officials who embezzled tremendous amounts of money.
• D)The United States witnessed a swarm of immigrants, which led to the rise in the unemployment rate.
• E)The United States experienced an earthquake, which led to an increase in the price of consumer goods.

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Definitions:

Top-Down Approach

A decision-making process that starts at the highest level of an organization and cascades down to lower levels; also, a method of analysis that begins with a macro overview before drilling down into specifics.

Operating Cash Flow

The cash generated by a company's normal business operations, indicating whether a company is able to generate sufficient positive cash flow to maintain and grow its operations.

Cash Expenses

These are expenses that require an immediate outlay of cash by the business.

Opportunity Cost

The cost of forgoing the next best alternative when making a decision, a fundamental concept in economics and financial decision-making.