'Cost-Push Inflation' Is Characterised By

question 100

Multiple Choice

'Cost-push inflation' is characterised by:

• A)very high levels of aggregate demand pushing prices higher.
• B)the short-run aggregate supply curve shifting to the right.
• C)rising prices and rising unemployment.
• D)an increase in the level of nominal wages.

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Definitions:

Law of Diminishing Returns

An economic principle stating that if one factor of production is increased while others are held constant, the overall returns will eventually decrease after a certain point.

Resource Demand Curve

A graph that illustrates the quantity of a resource demanded at various price levels.

Competitive Market

A market structure characterized by many buyers and sellers, where no single entity can affect the market price significantly.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a resource, factor, or input.