From supply side _______ is/are main cause of inflation.
From supply side _______ is/are main cause of inflation.
The correct option is C all the three
Inflation is an economic situation where the general price level
in the economy for all the relevant goods has a constant appreciable rise over
a considerable period of time. From the supply side, the main causes behind inflation are:
(i)
Irregular monsoons: If there are irregular monsoons, then it will affect the productivity of goods and services in the economy which will decrease the aggregate supply but the aggregate demand will have no change which will ultimately lead to excess demand and result in inflation.
(ii) Low agricultural productivity: If there is low agricultural productivity in the economy then the aggregate supply will be low but the aggregate demand will remain intact which will increase the general price level owing to excess demand.
(iii) Import restrictions: Import restrictions refers the restrictions like import duty and other charges which are charged on the goods and services which the economy imports from other economies. To restrict the imports, the import duty is generally set very high which the sellers compensate by increasing price of these goods and services which increases the general price level in the economy and leads to inflation.
Inflation is an economic situation where the general price level in the economy for all the relevant goods has a constant appreciable rise over a considerable period of time. From the supply side, the main causes behind inflation are:
(i) Irregular monsoons: If there are irregular monsoons, then it will affect the productivity of goods and services in the economy which will decrease the aggregate supply but the aggregate demand will have no change which will ultimately lead to excess demand and result in inflation.
(ii) Low agricultural productivity: If there is low agricultural productivity in the economy then the aggregate supply will be low but the aggregate demand will remain intact which will increase the general price level owing to excess demand.
(iii) Import restrictions: Import restrictions refers the restrictions like import duty and other charges which are charged on the goods and services which the economy imports from other economies. To restrict the imports, the import duty is generally set very high which the sellers compensate by increasing price of these goods and services which increases the general price level in the economy and leads to inflation.
