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WAEC Economics 1991 (August) Question 6

Question 6

Money and Inflation

If over a period of time there is more money in the economy than the available goods and services, the economy is likely to experience

  1. A.devaluation
  2. B.inflation
  3. C.deflation
  4. D.demonetization
  5. E.over-valuation
Show the answer and explanation

Answer: B (inflation)

Explanation

Too much money chasing too few goods pushes prices up: inflation.