Question:

Excess of money supply as compared to supply of goods results in

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Think “too much cash, too few goods” — that’s inflation in simple terms.
Updated On: Aug 11, 2025
  • Depression
  • Deflation
  • Trade deficit
  • Inflation
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The Correct Option is D

Solution and Explanation

Inflation occurs when there is too much money chasing too few goods.
This imbalance drives up prices, reducing the purchasing power of money.
In macroeconomics, controlling inflation involves regulating money supply and improving goods production to maintain price stability.
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