Cost-push inflation is characterized by rising prices due to supply-side shocks or increased production costs. Its effects often include reduced output, potential job losses, and decreased real income, leading to lower consumer spending.
What effect does cost-push inflation have on the economy?
Asked in KPSC KAS Prelims 2024 · Topic: Nature of Indian Economy (Developing Economy Characteristics)
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Answer: A. Increases real wages and boosts consumer purchasing power.
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