Question
Which the following is not the reason for demand pull
inflation?Solution
An administered price is the price of a good or service as dictated by government or central authority as opposed to buyers and sellers interacting according to supply and demand. So inflation is not because of demand. Stagflation · When an economy faces double issues of high inflation & high unemployment simultaneously, it is termed as stagflation. · Example- US Economy experienced such inflation in 1970s. · This type of inflation falsify the conventional that exists a trade off between inflation & unemployment (expressed by Phillips Curve).
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