Arrange the following statements in sequential order.

(A) Rise in prices.
(B) Central Bank increases margin requirement.
(C) Situation of excess demand in the economy.
(D) Aggregate demand falls.

Choose the correct answer from the options given below:

(C), (A), (B), (D)

The correct answer is Option (2) → (C), (A), (B), (D)

C) Situation of excess demand in the economy. This is the starting point — when aggregate demand exceeds aggregate supply, leading to inflationary pressure.

(A) Rise in prices. Excess demand causes prices to rise due to demand-pull inflation.

(B) Central Bank increases margin requirement. To control inflation and reduce excess demand, the central bank may raise the margin requirement to curb borrowing and spending.

(D) Aggregate demand falls. As a result of tighter credit conditions (due to increased margin requirement), borrowing and spending decrease, which leads to a fall in aggregate demand.