What is cost push inflation?

Cost push inflation is the result of an increase in the price of the factors of production e.g. labour, raw materials. For example, an increase in the price of oil will increase the price of most raw materials. Firms will have to increase their prices to sustain the same level of profits. This increase in price across the economy is cost push inflation.

NO
Answered by Nick O. Economics tutor

6052 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

What is the impact of a rise in national minimum wage on the labour market?


Discuss the perfect competition model?


Assume the market for Easter rabbits is currently at long term equilibrium. Assume Australia is the largest supplier of easter rabbits. A sudden explosion in the rabbit population of Australia leading up to Easter. How will the market react?


Discuss the effect of a carbon tax on the level of carbon emissions


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2026 by IXL Learning