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Which of the following scenarios illustrates cost-push inflation?(1 point)
A large increase in consumption increases aggregate demand, pushing prices higher throughout the economy.
A decrease in the price of raw materials increase aggregate supply, pushing prices lower throughout the economy.
An increase in the price of raw materials decreases aggregate supply, pushing prices higher throughout the economy.
A large decrease in consumption decreases aggregate demand, pushing prices lower throughout the economy.
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GPT-5 mini
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"An increase in the price of raw materials decreases aggregate supply, pushing prices higher throughout the economy."
Explanation: Cost-push inflation is caused by higher production costs (e.g., raw materials, wages) that reduce aggregate supply and raise the general price level.
Explanation: Cost-push inflation is caused by higher production costs (e.g., raw materials, wages) that reduce aggregate supply and raise the general price level.
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