Which one of the following sets of circumstances is most likely, other things remaining the same, to lead to demand-pull and cost-push inflation in an economy?
A depreciation in the exchange rate, and a reduction in the government’s budget surplus
2 )
Labour productivity growth in the economy accelerates, and interest rates fall
3 )
The minimum wage is increased, and business confidence in the economy falls
4 )
World demand for commodities increases, and the economy’s trade surplus becomes smaller
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