Respuesta :
During cost-push inflation, aggregate output decreases and the aggregate price level increases.
What is Cost Push Inflation?
Cost-push inflation occurs when overall prices increase (inflation) due to increases in the cost of wages and raw materials. Cost-push inflation can occur when higher costs of production decrease the aggregate supply (the amount of total production) in the economy.
When there is an increase in the prices of products, and the prices keep on increasing over a period of time, this is called as inflation.
When the cost of factors of product increases, it pushes the price of the product to increase. This is called as cost push inflation.
Increased cost of raw materials, labor, machinery, etc, will push the producers to charge more from the consumers to maintain their profits.
For example, increased wage rate of the employees push producers to charge more for the finished product. In this way the price of the products increase and the cost push inflation is caused.
Thus, During cost-push inflation, aggregate output decreases and the aggregate price level increases.
Read more about Cost Push Inflation at; https://brainly.com/question/13743753
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