Q. What happens when too much money is chasing too few things?
Answer: inflation
Notes: When aggregate demand in an economy exceeds aggregate supply, it drives demand into inflation. This includes rising inflation as real GDP rises and unemployment falling as the economy moves along the Phillips curve. It is commonly described as "too much money chasing too few goods" because money spent only on goods and services can lead to inflation.

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Question Number: 38 in 50. Inflation and Price Rise MCQs for SSC Examination in above course in App.