Inflation is caused by ________.

A) unions
B) rapid growth of the money supply
C) excess supply
D) low rates of capacity utilization

Money Supply

The total amount of monetary assets available in an economy at a specific time, including cash, coins, and balances held in checking and savings accounts.

Inflation

Inflation denotes the rate at which the general level of prices for goods and services is rising, and subsequently, purchasing power is falling.

Capacity Utilization

A measure of how effectively an entity uses its production capacity to produce goods, expressed as a percentage of total potential output.