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WAEC Economics 1997 Question 22

Question 22

Money and Inflation

Inflation caused by increase in demand can be curbed by

  1. A.exporting more goods and services
  2. B.hoarding of goods
  3. C.increasing the level of output
  4. D.increasing the level of money supply
  5. E.reducing importation
Show the answer and explanation

Answer: C (increasing the level of output)

Explanation

Demand-pull inflation is too much demand for too few goods; raising output closes the gap.