Deflation is a situation in which
(A) The value of money is, falling.
(B) The price of goods is increasing.
(C) The value of money is increasing.
(D) The price level is stagnant.
Correct Answer : The value of money is increasing.
Question Asked : SSC Constable (GD) Exam 2013
Explanation : Deflation is a situation where the prices of goods and commodities in a country go down. i.e. there is negative inflation. This is caused due to reduced supply of money jcredit. Inflation reduces the real value of money over time; conversely. deflation increases the real value of money - the currency of a national or regional economy.
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