The option that creates a dilemma for the government when considering implementing expansionary policy is:
Cost-push inflation
Cost-push inflation occurs when the overall prices increase due to rising costs of production, which can be caused by factors like increased wages or rising raw material costs. In this situation, implementing expansionary policy (which typically involves increasing government spending and/or lowering interest rates to stimulate the economy) could further exacerbate inflation without necessarily addressing the underlying issues in supply. This creates a dilemma as the government needs to balance the goal of stimulating economic growth with the risk of increasing inflation.