Perhaps, every county suffered from inflation once or more times. Inflation is an economic condition in (B1) prices for consumer goods (B2) , and the (B3) of money or purchasing power decreases. There are three causes of inflation. The first and most important cause may be excessive government spending. For example, in order to (B4) a war or carry (B5) social programs, the government may spend more money than it has received through taxes and other revenues, thus creating a deficit. In order to (B6) this deficit, the Treasury Department can simply (B7) the money supply by issuing more paper money to (B8) the debts of government. This increase in the money supply will cause the value of the dollar to (B9) decrease. The second cause of inflation occurs when the money supply increases faster than the supply of goods. (B10) people have more money, they will run out to buy popular goods (B11) televisions and computers, for example, and a shortage will result. Industry will then produce more, at higher prices, to (B12) demand. (B13) , if people think that the prices of popular goods are going up, they will buy and even borrow money at high (B14) rates to pay for them. Finally, if labor unions demand that workers’ wages (B15) or (B16) the high cost of living, industry will meet this demand and add other costs of production on the (B17) . (B18) summary, all of these causes can (B19) inflationary problems that can affect the welfare of a nation. However, of these three causes, (B20) government spending may be the most important.
A．raise
B．lower
C．increase
D．decrease
