Q. Which of the following describes Structural Inflation?

[A] Inflation caused by a persistent mismatch between demand and supply.

[B] Inflation caused by a sudden increase in the cost of production.

[C] Inflation caused by excessive government spending.

[D] Inflation caused by a rapid increase in the money supply.

Answer: A
Notes:

Explanation:

  • Structural Inflation is a type of inflation that arises from long-term, structural issues in the economy, such as supply bottlenecks, infrastructural deficiencies, or rigidities in the production system. This leads to a persistent mismatch between demand and supply.
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