Multiple choice

Deflation is

  1. deficit budget

  2. reduction in taxation

  3. contraction in volume of money or credit that results in a decline of price level

  4. increase in public expenditure
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Deflation is a general decline in prices for goods and services, typically associated with a contraction in the supply of money or credit in the economy.

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