In economic terms, which type of inflation is primarily driven by increased costs of production?

Cost push inflation is the correct answer because it specifically refers to a situation where the overall prices in an economy rise due to increases in the cost of production. This type of inflation occurs when businesses experience a rise in the prices of raw materials, labor costs, or any other inputs necessary for production. As production costs climb, manufacturers often pass these higher costs on to consumers in the form of increased prices for goods and services. This leads to a rise in the general price level, even if demand has not changed significantly.

Other forms of inflation, such as demand pull inflation, occur when the demand for goods and services exceeds their supply, driving prices up in response to increased consumer spending. Monetary inflation is related to the money supply in the economy, suggesting that an increase in money supply leads to increases in prices. Structural inflation arises from changes in the structure of the economy, such as changes in regulations or industries that affect production and pricing in a significant way. These types, while they can lead to inflation, do not specifically focus on the increased costs of production as the primary driver.