An economy in a recession that experiences disruptions in markets for goods used in the production of consumer goods will experience Blank______.

Question

Multiple choice question.

steady deflation

cost-push inflation

no inflation

demand-pull inflation

Answer 1

The correct answer is cost-push inflation.

In a recession, when there are disruptions in the markets for goods used in the production of consumer goods, production costs may rise. This can lead to an increase in prices for consumer goods despite the overall economic slowdown, resulting in cost-push inflation.