Stagflation might be caused by a decrease in the money supply. b increase in the price of raw materials. c increase in technology. d increase in the money supply. e decrease in the price of raw materials.

Question

Jace Jones

Business

23 June, 13:38

Stagflation might be caused by a decrease in the money supply. b increase in the price of raw materials. c increase in technology. d increase in the money supply. e decrease in the price of raw materials.

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Leonel Manning · Answer 1

Increase in price of raw material

Explanation:

Stagflation might be caused by a increase in price of raw material.

Stagflation is a situation in which there is low economic growth and high unemployment along with high prices.

The main cause of stagflation is cost pushed inflation. Cost push inflation is that situation in which some forces lead to increase in cost of production. It could be because of the government policies or some other external factors.

Stagflation cause high inflation, stagnation and high unemployment. It means that high unemployment and no economic growth.

During the time of stagflation there are three business which performed well in this period they are gold, oil and metal.