What is called increased demand for a limited supply of goods and service result of which is increase in consumer prices ?
Correct answer: B. Demand pulls
- A. Demand push
- B. Demand pulls
- C. Cost pull
- D. Demand supply
Explanation
Demand-pull inflation occurs when aggregate demand rises faster than the available supply of goods and services, pushing prices upward. Option b is the intended form of “demand pull,” although its wording is grammatically incomplete.
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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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