Deficit financing leads to inflation in general, but it can be checked if

A) government expenditure leads to increase in the aggregate supply in ratio of aggregate demand B) only aggregate demand is increased C) all the expenditure is denoted national debt payment only D) All of the above

Answer & Solution

Correct Answer: Option D

Deficit financing leads to inflation in general, but it can be checked if government expenditure leads to increase in the aggregate supply in ratio of aggregate demand, only aggregate demand is increased and all the expenditure is denoted national debt payment only.

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3 Comments

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Mumtaz Ahmad 5 years ago

I think A should be the option.

Arpita Manna 7 years ago

Why option D ?

Amandeep Sangwan 8 years ago

Why D

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Deficit financing leads to inflation in general but it can be...

Deficit financing leads to inflation in general, but it can be checked if

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