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In Economics / Senior High School | 2025-05-23

Which type of inflation is most likely to become hyperinflation if left unchecked?
A. Demand-pull inflation
B. Disinflation
C. Deflation
D. Core inflation

Asked by mikeypaige3047

Answer (1)

The correst answer is A. Demand-pull inflation—caused by too much money in circulation and rising demand—can turn into hyperinflation if governments or central banks keep printing money. A famous example is Zimbabwe in the 2000s, where money was printed excessively, leading to prices doubling every day. In the Philippines, the BSP carefully monitors money supply to prevent this extreme outcome.

Answered by Sefton | 2025-05-26