The greatest economic challenge that Country D is facing IS that of Inflation.
Inflation refers to the market scenario where in the average price of the goods and services increase and the income of the people does not witness an increase in accordance to the price.
Explanation:
Inflation refers to the market scenario where in the average price of the goods and services increase and the income of the people does not witness an increase in accordance to the price.
From the given scenario in the question
The citizens of Country D have noticed that the average prices of most goods within their nation have begun to rise. At the same time, employers are not raising wages at the same rate. The combination of these challenges has resulted in a decrease in overall demand, causing a decline in GDP. According to the scenario,the greatest economic challenge that Country D is facing is that of Inflation
