If Increases in Total Spending Are Not Offset by Increases

question 114

Multiple Choice

If increases in total spending are not offset by increases in the supply of goods and services, the average price level will rise.Which of the following factors is responsible for this rise?

• A)Cost-push inflation
• B)Fiscal deficit
• C)Demand-pull inflation
• D)Wage-push inflation
• E)Unemployment

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Definitions:

Waiting Line

A waiting line, or queue, is a sequence of people or items awaiting service or processing in various settings, such as in banks, shops, or production systems.

Discrete Probability

The mathematical study of probability where the outcome is determined from a set of distinct, separate values.

Queuing Theory

A body of knowledge about waiting lines.

Little's Law

A principle in queuing theory stating that the long-term average number of customers in a stable system L is equal to the long-term average effective arrival rate, λ, multiplied by the average time a customer spends in the system, W (L = λW).