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Deflation is a situation in which
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- The value of money is falling.
- The price of goods is increasing.
- The value of money is increasing.
- The price level is stagnant.
- The value of money is falling.
Correct Option: C
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/credit. 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.
