Economics · Types of Inflation
Demand-pull inflation typically occurs in an economy when:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Direct taxes on consumers are significantly increased
- 2Costs of production experience a sudden decline
- 3Aggregate demand exceeds aggregate supply at full employment✓
- 4Aggregate supply significantly exceeds aggregate demand
Correct answer
Aggregate demand exceeds aggregate supply at full employment
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