CFA Practice Question

There are 539 practice questions for this study session.

CFA Practice Question

The most likely initial (short-run) effect of demand-pull inflation is an increase in ______.
A. the price level and a decrease in real GDP
B. the price level and an increase in real GDP
C. government expenditure followed by a decline in the quantity of money
Explanation: The initial effect of demand-pull inflation is an increase in aggregate demand, which, in turn, leads to an increase in the real GDP.

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