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In Business / College | 2025-07-06

If the CPI value decreases from one year to the next, what do we know about inflation and deflation?
A. The economy is growing.
B. Deflation is occurring.
C. Inflation is occurring.
D. The unemployment rate is rising.

Asked by alannaussery2017

Answer (2)

A decrease in the CPI indicates deflation, meaning prices are falling. This situation is contrary to inflation, which involves rising prices. While deflation can have various impacts, it doesn't directly signal changes in the unemployment rate. ;

Answered by GinnyAnswer | 2025-07-06

A decrease in the CPI indicates deflation, meaning prices are falling. This situation contradicts inflation, which involves rising prices. Therefore, the correct option is B: Deflation is occurring.
;

Answered by Anonymous | 2025-07-07

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