Chapter 3R, Problem 20MCQ

To determine

The term used for the falling inflation rate.

Explanation of Solution

Inflation indicates an increase in the general prices of goods and services in a market. Lenders, savers, and individuals with fixed incomes are hurt by the inflation while borrowers gain from the inflation.

The given options are:

• Negative inflation or deflation represents a fall in the general price level in the market.
• Bubble popping represents an increase or boom in the production of goods and services in an economy.<
• Contraction is the fall in the production of goods and services in an economy. <
• The process of slowing down the rate of inflation is termed disinflation in a market.

So, bringing down the inflation rate is known as disinflation.

Option “d” is correct.