Economics › Inflation

Consider the following statements:

Other things remaining unchanged, market demand for a good might increase if:

1.The price of its substitute increases.
2.The price of its complement increases.
3.The good is an inferior good, and the income of the consumers increases.
4. Its price falls.
Which of the above statements are correct?

Which one of the following is likely to be the most inflationary in its effects?

With reference to the Indian economy, demand-pull inflation can be caused or increased by which of the following:

1.Expansionary policies
2.Fiscal stimulus
3.Inflation-indexing of wages
4.Higher purchasing power
5.Rising interest rates

Select the correct answer using the code given below: