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Which of the following is NOT a cause of cost-push inflation?

medium Q5 of 15
Economic Awareness - Sectors of Indian Economy
Which of the following is NOT a cause of cost-push inflation?
AIncrease in wages of workers
BRise in prices of imported raw materials
CExcessive money supply in the economy
DHigher taxes on production inputs
Step-by-Step Solution

  1. Step 1: Identify causes of cost-push inflation

    Cost-push inflation is caused by rising production costs such as wages, raw materials, and taxes.

  2. Step 2: Analyze options

    Increase in wages, raw material prices, and taxes increase production costs causing cost-push inflation. Excessive money supply causes demand-pull inflation, not cost-push.

  3. Final Answer:

    Excessive money supply in the economy → Option C

  4. Quick Check:

    Excessive money supply causes demand-pull, NOT cost-push inflation ✅
Quick Trick: Money supply affects demand-pull, not cost-push inflation.
Common Mistakes:
  • Confusing monetary causes with cost-push inflation causes.
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