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Milton Freedman probably is the best person to look up for this answer, and he has written much on this topic.
Basically it is a monetary phenomina. Increases and decreases in the money supply create inflation or deflation. Think of the root form of this word, inflate, such as a balloon or a tire. Increasing the quantity of a price does not make sense, however rising prices due to increasing the quantity of money in the money supply does.
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∙ 12y ago
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Is it good to have oversupply of money?
Oversupply of money results in inflation. High inflation creates uncertainty and can wipe away the value of savings. When there is oversupply of money prices of items will go up. Inflation also affects distribution of wealth negatively.
What is the definition of economic inflation?
Economic inflation or just inflation is the rate at which the general level of prices for goods and services is rising. Central banks attempt to stop severe inflation, along with severe deflation, in an attempt to keep the excessive growth of prices to a minimum. Inflation or deflation will always occur in a economy but the role of the Fed is to make less severe.
Will inflation Peter out?
inflation peter out is when inflation diminish or stops .
What refers to the persistent increase in the prices of goods and services?
inflation
The consumers price index helps the U.S. government measure what?
inflation
Is it good to have oversupply of money?
Oversupply of money results in inflation. High inflation creates uncertainty and can wipe away the value of savings. When there is oversupply of money prices of items will go up. Inflation also affects distribution of wealth negatively.
What is the definition of economic inflation?
Economic inflation or just inflation is the rate at which the general level of prices for goods and services is rising. Central banks attempt to stop severe inflation, along with severe deflation, in an attempt to keep the excessive growth of prices to a minimum. Inflation or deflation will always occur in a economy but the role of the Fed is to make less severe.
Who can benefits when the inflation is existing?
The government can benefit from inflation existing because it creates inflation by printing off money. The money it prints off can be used to finance expenses and the costs of printing money (and thus creating value from nowhere) are paid for by citizens of the country who experience higher prices as the value of their money falls.
What inflation rate?
inflation
Inflation rates?
inflation
Will inflation Peter out?
inflation peter out is when inflation diminish or stops .
What refers to the persistent increase in the prices of goods and services?
inflation
inflation?
rising prices
The consumers price index helps the U.S. government measure what?
inflation
Bad effect of public debt?
• It may lead to wasteful government spending .. • It creates inflation • It is a burden to future generations • It is the reduction of future consumption and savings • It dampens incentives to do productive or business ventures
What will bi the formula of inflation?
Current year's inflation - last year's inflation / last year's inflation * 100 e.g ((B-A)/A)*100
What part of speech is inflation?
Inflation is a noun.
