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Question 2 Food inflation continues to contribute to the rise in national inflation, January 2022 National inflation in January 2022 increased 2.3 per cent to

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Question 2 Food inflation continues to contribute to the rise in national inflation, January 2022 National inflation in January 2022 increased 2.3 per cent to 124.9 as against 122.1 in the same month of the preceding year due to the base effect. The increase also surpassed the average inflation in Malaysia for the period 2011 to January 2022 (1.9%). Source: Department of Statistic Malaysia. a) Discuss how government control inflation rate using Open Market Operation (OMO) and reserve requirement by discretionary monetary policy (10 Marks) b) Explain THREE (3) factors that cause inflation by demand pull inflation. (6 Marks) c) Determine and explain TWO (2) level of country that can occur in the county. (4 Marks)

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