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    Question

    Which of the following best describes a general rise in the prices?

    A Inflation Correct Answer Incorrect Answer
    B Deflation Correct Answer Incorrect Answer
    C Stagflation Correct Answer Incorrect Answer
    D Disinflation Correct Answer Incorrect Answer
    E Hyperinflation Correct Answer Incorrect Answer

    Solution

    Inflation is the general increase in the prices of goods and services in an economy over time. When inflation occurs, the purchasing power of a currency decreases, which means that the same amount of money can buy fewer goods and services than before. Inflation can be caused by a variety of factors, including an increase in demand for goods and services, a decrease in supply of goods and services, or an increase in the cost of production.

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