Praxis II: Economics Content Knowledge Exam Prep

Answer - D - Deflation is the correct term for a sustained decrease in the general price level within an economy.

Key Takeaway: The opposite of deflation is inflation, a sustained increase in the general price level within a given economy. Always keep in mind that an increase in the price of only one good would not necessarily signal inflation. Rather, it could be part of a broader societal increase that would be inflation. It is always important to look at the economy as a whole.