An increase in the amount of money circulating in the econmomy, ceterics pair bus will result in which of the following

A. Demand side inflation
B. supply side deflation
C. Supply side inflation
D. Demand side deflation

To determine the answer to the question, we need to understand the concepts of demand-side and supply-side effects in the context of inflation and deflation.

Inflation refers to a general rise in the prices of goods and services in an economy over a period of time, resulting in a decrease in the purchasing power of currency. Deflation, on the other hand, refers to a general decrease in the prices of goods and services, resulting in an increase in the purchasing power of currency.

Now, let's examine the options given:

A. Demand-side inflation: This option suggests that increasing the amount of money circulating in the economy will lead to inflation driven by increased demand for goods and services. Essentially, when there is more money available, people have more purchasing power, leading to higher demand and potentially higher prices. This means that option A is a possible outcome in this scenario.

B. Supply-side deflation: This option suggests that increasing the amount of money circulating in the economy will result in deflation caused by changes in the supply side. Supply-side deflation typically occurs when increased money circulation leads to increased production, which then drives down prices. However, in the given scenario, an increase in money supply is not usually associated with supply-side deflation. Therefore, option B is unlikely.

C. Supply-side inflation: This option suggests that increasing the amount of money circulating in the economy will cause inflation due to changes on the supply side. However, in the context provided, an increase in the money supply is more likely to lead to demand-side effects rather than supply-side effects. So, option C is less likely to be the correct answer.

D. Demand-side deflation: This option suggests that increasing the amount of money circulating in the economy will result in deflation driven by decreased demand for goods and services. This outcome is highly unlikely since increased money supply generally leads to increased demand and potential inflation. Therefore, option D is not the correct answer.

Based on the analysis, the correct answer is A. Demand side inflation.