34. Cash-Push Inflation (CPI) is usually associated with (A) Currency factors (B) Monetary factors (C) Non-monetary factors (D) Non-currency factors
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The correct answer is option (b)monetary factors.
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It is associated with (B) Monetary factors
- It happens when the cost of labour and raw materials rises, causing overall prices to rise. Thus, it is dependent on monetary factors in the system.
- It takes place when increasing production costs reduce the inclusive economy's entire supply which is the total output quantity.
- It also cuts down the buying power, or the amount of anything that can be bought with money, thereby stimulating people to spend and store up on commodities depreciating more slowly.
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