Deflation occurs when A. there is a sustained increase in the price level. B. there is a decrease in the expected rate of inflation. C. there is a oneminus−time increase in the price level. D. there is a decline in the price level.

The correct answer is letter "D": there is a decline in the price level.

Explanation:

Deflation is an economic concept used to describe a phase in which goods and services prices decrease. Decreases in money supply, government spending, consumer demand, and business investment have all been cited as causes of deflation. This typically occurs when there is reduced demand for products and services and higher rates of unemployment during an economic crisis.

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