Question 19
MediumOriginal questionPrices are still rising, but more slowly than last year. What is this called?
Show the answer and explanation
CorrectNot quiteAnswer D
Correct answer: D
Explanation
Disinflation is a fall in the rate of inflation while the rate stays positive.
Deflation is different: it is a fall in the price level itself, which means a negative rate.
So disinflation still means things are getting dearer, only less quickly.
Worth noting
Stagflation is a third thing again — high inflation alongside stagnant output and high unemployment.
- Concept
- Disinflation against deflation
- Typical timeTypical
- 40 s
- Your timeYours
- —
Practise this chapter →
Ten questions from Indian Economy & Institutions, at your own pace.