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Cost push inflation is caused by a

Economics
WAEC 2011

Cost push inflation is caused by a

  • A. rise in the cost of production
  • B. decrease in the transportation cost
  • C. rise in demand for goods
  • D. decrease in the cost of production
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Correct Answer: Option A
Explanation

Cost-push inflation occurs when overall prices increase due to increases in the cost of wages and raw materials. An increase in the cost of wages and raw materials means high cost of production. This will cause the prices of goods to rise 


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Post-UTME Past Questions - Original materials are available here - Download PDF for your school of choice + 1 year SMS alerts