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In general it happens when demand for products and services by consumers is stronger than the supply of the desired products and services. For example, in the current world economy, developing countries like China and India are demanding more materials to support their growth--oil, building materials, copper, etc. That extra demand causes the prices of those items to rise because there is limited supply. And many of those items are required to operate manufacturing plants and other consumer services so prices of other items goes up as well--e.g., cereal, UPS shipping, gas.
when consumers have more disposable income (a+)
What else can I help you with?
When do inflation occur?
When goods or services in general cost less in the deflated currency than previously.
What will happen if everyone expects inflation to occur?
If people expect inflation, they are more inclined to spend than save money which will lose its value. A surge in demand will cause an an increase in prices (because demand exceeds supply) and voila! Inflation.
How does Krugman feel about inflation?
Paul Krugman, a columnist with The New York Times, has published an article that promotes the view that inflation should be allowed to occur. High inflation, he states, promotes spending over saving, and reduces the real value of any debts.
What is pricing power inflation?
Pricing Power InflationPricing power inflation is more often called administered price inflation. This type of inflation occurs when the business houses and industries decide to increase the prices of their respective goods and services to increase their profit margins. Pricing power inflation does not occur at the time of financial crises and economic depression or when there is a downturn in the economy. This type of inflation is also called oligopolistic inflation because oligopolies have the power of pricing their goods and services at whatever levels they want.
What is diflation?
Deflation is decrease in general price level of services and goods. Deflation occur when inflation rate is 0%
Why did inflation occur after the war?
a low supply of goods and widespread demand
Why did inflation occur after ww1?
A low supply of goos and a widespread demand
When do inflation occur?
When goods or services in general cost less in the deflated currency than previously.
What will happen if everyone expects inflation to occur?
If people expect inflation, they are more inclined to spend than save money which will lose its value. A surge in demand will cause an an increase in prices (because demand exceeds supply) and voila! Inflation.
What has the author James Bullard written?
James Bullard has written: 'Did the great inflation occur despite policymaker commitment to a Taylor rule?' -- subject(s): Industrial productivity, Inflation (Finance)
How does Krugman feel about inflation?
Paul Krugman, a columnist with The New York Times, has published an article that promotes the view that inflation should be allowed to occur. High inflation, he states, promotes spending over saving, and reduces the real value of any debts.
What is pricing power inflation?
Pricing Power InflationPricing power inflation is more often called administered price inflation. This type of inflation occurs when the business houses and industries decide to increase the prices of their respective goods and services to increase their profit margins. Pricing power inflation does not occur at the time of financial crises and economic depression or when there is a downturn in the economy. This type of inflation is also called oligopolistic inflation because oligopolies have the power of pricing their goods and services at whatever levels they want.
What is diflation?
Deflation is decrease in general price level of services and goods. Deflation occur when inflation rate is 0%
Why did inflation in the north and south occur during the civil war?
the limited supply of goods caused prices to rise.
Why did inflation occur in the north and the south during the civil war?
the limited supply of goods caused prices to rise.
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.
Does scarcity increase inflation?
Yes, scarcity can contribute to inflation. When there is a limited supply of goods or services, demand may outpace availability, leading to higher prices. This situation can occur due to various factors, such as supply chain disruptions or increased consumer demand. As prices rise in response to scarcity, overall inflation can increase as well.
