Which term refers to an economic situation where the small amount of money in circulation lowers prices and lessens demand for g

Question

MrRissso [65]

2 years ago

6

Which term refers to an economic situation where the small amount of money in circulation lowers prices and lessens demand for g

oods?
a. competition
b. distribution
c. substitution
d. deflation

History

2 answers:

Ivan · Answer 1 · 2022-07-08T00:40:17+03:00

Ivan2 years ago

6 0

Answer is d. deflation

marusya05 [52] · Answer 2 · 2022-07-08T03:07:36+03:00

Answer:

The correct answer is deflation. Deflation is the reduction in the price levels. It is the opposite to Inflation. Deflation can occur when the supply of goods is higher than the demand (more things are offered than people want to buy), thus decreasing the price of things. It can also occur when the money supply (the amount of money in an economy) is low, and therefore, each bill and coin has more value and can buy more things.