Multiple choice

The process of curing inflation by reducing money supply is called ____.

  1. Cost - push inflation

  2. Demand - pull inflation

  3. Disinflation

  4. Reflation

Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Disinflation refers to the process of reducing inflation through deliberate monetary policy measures, primarily by decreasing money supply. Demand-pull and cost-push are types of inflation, not cures. Reflation is the opposite - increasing money supply to combat deflation.