21
RCMultiple Choice

Unit Test — Cumulative exam

Question 21 • $2526: Full: 2102320: Economics HONORS: NEW CREDIT

Cost-push inflation occurs when

Answer
A
consumers begin purchasing more goods.
B
producers need more money to make and distribute goods.
C
the government prints more money and pushes prices up.
D
consumers have more money to spend on goods and services.

Explanation

Cost-push inflation happens when the costs of producing or distributing goods rise, leading businesses to charge higher prices. Producers needing more money to make and distribute goods describes this increase in production costs; increased consumer spending is instead associated with demand-pull inflation.

AI-written and checked against the verified answer.

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