(Answered) True or False: One-shot inflation may be a demand-side (of the economy) or a supply-side…

➤ How do expectations and wages make inflation persistent?
Expectations and wages make inflation persistent when workers and firms expect higher prices and build them into contracts and prices. Indexation, regular wage bargaining, and weak central bank credibility produce wage-price spirals. Once expectations unanchor, businesses raise prices preemptively and workers demand higher wages, creating self-sustaining inflation.