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Which one of the following causes the condition in which prices increase rapidly as a currency loses its value ?
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- Stagflation
- Conflation
- Stealth inflation
- Hyper inflation
Correct Option: D
Hyper inflation occurs when a country experiences very high and usually accelerating rates of monetary and price inflation, causing the population to minimize their holdings of money. Under such conditions, the general price level within an economy increases rapidly as the official currency quickly loses real value.
