Question

What is the difference between inflation and deflation?

a. inflation is a rise in the general price level over time while deflation is a fall in the general price level over time.
b. inflation is a continuous rise in the price level while deflation is a one-time rise in prices.
c. deflation is a continuous rise in the price level while inflation is a one-time rise in prices.
d. inflation happens when all prices are rising, while deflation happens when only some prices are rising?

Answer 1

i don't know maybe c

Answer 2

a. inflation is a rise in the general price level over time while deflation is a fall in the general price level over time.

Step-by-step explanation:

Inflation occurs when the prices of goods and services rises over time. For example, a bag of cookies today is, for example, $1. If in a year it is $1.20, there was an inflation.

Deflation occurs when the prices of goods and services decreases over time. For example, a bag of cookies today is, for example, $1. If in a year it is $0.80, there was a deflation.

So, the correct answer is:

a. inflation is a rise in the general price level over time while deflation is a fall in the general price level over time.