Question

2 multiple choice 1 point what does inflation mean? when money gains more value and prices decrease when new jobs are created in the economy when the buying power of money goes down and prices increase when the government lowers taxes

Explanation:

To determine the correct answer, we analyze each option:

• The first option describes deflation (money gains value, prices decrease), not inflation.
• The second option relates to job creation (employment growth), not inflation.
• The third option matches the definition of inflation: a general increase in prices and a fall in the purchasing power of money.
• The fourth option is about tax reduction (fiscal policy), not inflation.

Answer:

C. When the buying power of money goes down and prices increase