Cost-Push Inflation Is Caused By

question 30

Multiple Choice

Cost-push inflation is caused by:

• A) an increase in aggregate demand.
• B) an increase in short-run aggregate supply.
• C) a decrease in aggregate demand.
• D) a decrease in short-run aggregate supply.

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Definitions:

Modify

To change or alter something, often to improve it or to make it suitable for a different purpose.

Variable Selling Costs

Expenses that vary directly with the volume of production or sales, such as commissions or shipping charges.

Full Cost

The total cost incurred for producing a product or delivering a service, including both fixed and variable expenses.

Idle Capacity

The portion of a company's resources or production ability that is not being used in production but still incurs costs.