A. A decrease in the cost of goods and services best describes deflation
What is deflation
Deflation refers to a general decrease in the prices of goods and services in an economy over time. It is the opposite of inflation, which is characterized by a general increase in prices.
When an economy experiences deflation, the cost of goods and services tends to decline.
This can happen due to various factors such as reduced consumer demand, excess supply, technological advancements leading to increased productivity, or a decrease in the money supply circulating in the economy.
Question
Which of the following best describes deflation?
A. A decrease in the cost in the goods and services.
B. An increase in the cost of goods and services.
C. A decrease in purchases of goods and services.
D. A increase in purchases of goods and services.