Inflation is an economic condition in【C1】______prices for consumer goods【C2】______, and th

e【C3】______of money or purchasing power decreases. There arc three important causes of inflation. The first and most important cause may be excessive government spending. For example, in order to【C4】______a war or carry【C5】______social programs, the government may spend more money than it has received through taxes and other revenue, thus creating a deficit. In order to【C6】______this deficit, the Treasury Department can simply【C7】______the money supply by issuing more paper money to【C8】______the debts of government. This increase in the money supply will cause the value of the dollar to【C9】______decrease. The second cause of inflation occurs when the money supply increases faster than the supply of goods.【C10】______people have more money, they will run out to buy popular goods【C11】______televisions and computers, for example, and a shortage will result. Industry will then produce more, at higher prices, to【C12】______demand.【C13】______, if people think that the prices of popular goods are going up, they will buy and even borrow money at high【C14】______rates to pay for them. Finally, if labor unions demand that workers, wages【C15】______to【C16】______the high cost of living, industry will meet this demand and add other costs of production on to the【C17】______.【C18】______summary, all of these causes can【C19】______inflationary problems that can affect the welfare of a nation. However, of these three causes,【C20】______government spending may be the most important.

【C1】

A．this

B．which

C．that

D．what