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NDA 2017 GAT · General Knowledge · Indian Economy · easy

Inflation in an economy refers to

Single correct option

Inflation in an economy refers to
  1. A. A fall in the general price level
  2. B. A rise in the price of one commodity
  3. C. An increase in the value of money
  4. D. A sustained rise in the general price level
Show answer and solution

Answer: (D) A sustained rise in the general price level

Inflation means a continuing rise in the general level of prices of goods and services over time, which lowers the purchasing power of money. A fall in the general price level is deflation. A rise in the price of a single commodity does not constitute inflation, and a higher value of money would imply falling prices, which is the opposite effect.
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Original question written in the NDA 2017 GAT pattern and checked twice for the correct answer. Not an official question paper. How we write and check questions · Corrections policy · Report a mistake