Q. Which one of the following statements correctly describe the term “Shrinkflation”?

[A] A type of inflation which takes place due to downsizing a product while keeping its price the same

[B] A type of inflation in which the inflation rate is high, the economic growth rate slows, and unemployment remains steadily high.

[C] A type of inflation that takes place when supply falls drastically due to supply-side accidents or mismanagement, but demand remains at the same level.

[D] A type of inflation in which the prices of a single commodity or a set of commodities rise while the overall price level remains stable.

Answer: A
Notes:

Shrinkflation: Downsizing a product while keeping its price the same is sometimes called “shrinkflation”—a combination of the words shrink and inflation. Companies face higher prices for their supplies and may try to pass that onto the consumer. Downsizing a product reduces costs for manufacturers.

Stagflation: A type of inflation in which the inflation rate is high, the economic growth rate slows, and unemployment remains steadily high.

Bottleneck inflation: A type of inflation that takes place when supply falls drastically due to supply-side accidents or mismanagement, but demand remains at the same level.

Skewed inflation: A type of inflation in which the prices of a single commodity or a set of commodities rise while the overall price level remains stable.

Blog
Academy
Community