Deflation Usually Arises Due to ________

Multiple Choice

Deflation usually arises due to ________. This in turn ________ interest rate, which ________.

A) loose fiscal policy; reduces the market; causes hyperinflation
B) tight monetary policy; pushes up the nominal; always leads to a recession
C) a recession; raises the real; deepens the recession
D) an exchange rate depreciation; lowers the real; makes imports more expensive
E) oil price declines; increases the mortgage; slows housing price growth