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What are the differences between inflation and deflation?
Inflation is when the value of money declines so it takes more dollars to purchase the same goods or services. Deflation is the opposite.
Why is a low level of inflation desirable in an economy and why is deflation not desirable?
A low level of inflation is desirable because it encourages consumer spending and investment, as people are more likely to make purchases when they expect prices to rise gradually. It also helps to reduce the real burden of debt, making it easier for borrowers to repay loans. Conversely, deflation is not desirable because it can lead to decreased consumer spending, as people may delay purchases in anticipation of lower prices, resulting in reduced economic activity and higher unemployment. Additionally, deflation increases the real value of debt, making it harder for borrowers to meet their obligations.
When nominal GDP is less than real GDP is this inflation or deflation?
deflation
Is a rise in the cost of goods and services called inflation or deflation?
Inflation
True or false Inflation refers to a dramatic drop in prices?
False!Inflation means a dramatic increase in prices. The opposite of inflation is deflation. Deflation is a dramatic decrease in prices.
What is a decrease in the price level?
Inflation
In the absence of unexpected shocks does the economy tend to experience inflation or deflation?
inflation
Lowest inflation rate in world?
The lowest inflation rate in the world is 0% in Japan. There are countries in which there is a negative inflation, but these cases are not called low inflation, they are called deflation. the highest deflation rate is 3% in Nauru (you may as well call it a -3% inflation)
What is the difference between recession and deflation?
recession is when you have no growth in the economy for at least 6 months and deflation is when prices in general instead of getting more expensive go down or are less expensive. When you are in a recession depending on the particular recession prices can go up down or stay the more or less the same
The changing cost of money is referred to as?
Inflation/deflation.
What is the CPI most likely measuring?
inflation and deflation
Is the deflation good for the economy?
yes,deflation...in my own opinion is good to the country,but permit me to say the little i know about (inflation) and( deflation).inflation...means when there is excess of money circulating within a given country while deflation means when there is less money.......so deflation is good for a country in a way that,there will be no inappropraite in terms of goods and services,,
