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WAEC Economics 2006 Question 30

Question 30

Money and Inflation

The tendency for prices to rise while the value of money falls is known as

  1. A.bills of exchange
  2. B.inflation
  3. C.depreciation
  4. D.deflation.
Show the answer and explanation

Answer: B (inflation)

Explanation

Inflation is a persistent rise in the general price level, which reduces what money can buy.