In a developing nation people start to obtain good jobs Then inflation cuts their income the people begin to feel_________________?
Correct answer: B. a failure of rising expectations
- A. relative deprivation
- B. a failure of rising expectations
- C. euphoria
- D. depression
Explanation
When improving expectations are followed by inflation and declining real income, people experience a failure of rising expectations. Relative deprivation is a broader feeling of being worse off compared with others, but the sequence described points more specifically to this concept.
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The economy is studied as a whole through national income, gross domestic product, inflation, unemployment, economic growth and business cycles. Coverage includes aggregate demand and supply, consumption and investment, money and banking, fiscal and monetary policy, exchange rates and balance of payments, which distinguishes macroeconomics from the study of individual markets.
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