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General Knowledge - Indian Economy - Discussion

Discussion Forum : Indian Economy - Indian Economy (Q.No. 10)
Indian Economy
10.

Deficit financing leads to inflation in general, but it can be checked if

government expenditure leads to increase in the aggregate supply in ratio of aggregate demand
only aggregate demand is increased
all the expenditure is denoted national debt payment only
All of the above
Answer: Option
Explanation:
No answer description is available. Let's discuss.
Discussion:
25 comments Page 1 of 3.
Pardeep Kaur said:   8 years ago
I think answer should be A.
(2)
Rashmi said:   8 years ago
Answer should be A only.
(2)
Ainup said:   9 years ago
The answer should be A, the other options are not convincing from question's point of view.
(2)
SAHIL said:   5 years ago
The correct Answer is A, other options are incorrect because if you want to counter inflation at a time with deficit financing, the best way is to have shift in Aggregate supply curve to counter the rise in inflation. Other options are incorrect and will only increase inflation.
(1)
Sahadev Mili said:   7 years ago
The answer should be A.
(1)
M K Pattnaik said:   10 years ago
Answer should be option A.
(1)
ABHAY said:   1 decade ago
Why b is included ?
Naman Kumar said:   2 months ago
Government spending boosts aggregate supply—for example, through infrastructure, productivity, or capacity-building investments.

This helps balance the rise in demand and keeps prices stable.

So, the Correct Answer is (A).
Jayaram said:   5 years ago
Options A, B, C satisfying because in the question "deficit financing leads to inflation in general"mentioned which means in general inflation occurred due to deficit.
Jyothsna said:   5 years ago
What is an aggregate demand?
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