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Inflation
A persistent increase in the level of consumer prices or a persistent decline in the purchasing power of money, caused by an increase in available currency and credit beyond the proportion of available goods and services.
1,474 Questions
if your stupid and careless, yes. just stop if you feel pain and youll fart it out
Which of the following products would be used in calculating GDP?
cars manufactured in Tennessee at a factory owned by a Japanese automobile company
What is the value of a 1980 dollar in todays dollars?
In 2007, $1.00 from 1980 is worth:
$2.52 using the Consumer Price Index
$2.22 using the GDP deflator
$3.07 using the value of consumer bundle
$2.43 using the unskilled wage
$3.74 using the nominal GDP per capita
$4.95 using the relative share of GDP
in/de-flation, fiat money, gold of $1There are a few ways to decide the answer to this question. One is based on the value of the item the dollar was based on, another is to base it on the current and past buying power of one dollar, lastly you can observe and compare with other major nations values with today, then there's a semi-complicated process of taking the rate of inflation and working that out for 72 years. Here's a short history lesson and conclusion about just gold and fiat money. From the beginning of coins and money, almost all currencies have been based on the value of gold or silver. In societies and countries where all money was made of gold, there could be no devaluation of the currency, only fluctuations in the prices of individual commodities.Once "fiat" money had been invented, it became worth what a consensus of people thought it was worth. "Fiat money" is money which has a value which is not represented by its intrinsic metal content. It also became easy for governments to issue more money than they held in reserves.n 1934 or 1935, the USA fixed the price of gold at $35 per ounce. This was done not to stabilize the price of gold against the dollar, but the opposite, to stabilize the value of the dollar because it had a fixed exchange rate for gold. This was done to restore confidence in the dollar and the US economy after the 1929 share collapse and the depression of the 1930's. It appears to have worked, because the USA, with its almighty dollar, became the powerhouse of world trade, and the richest nation on earth. Most good things come to an end, though, and by about 1967, most of the world did not believe the dollar was still worth 1/35th of an ounce of gold, or put another way, they believed that gold was worth more than $35 per ounce. USA had to sever the tie between gold and the dollar, allowing gold to start its meteoric rise from $35 per ounce to a peak of $850. Most charts put together compares the buying power with 1980. If you held onto one dollar until 1980 you would lose in appreciation approximately 82 cents based on inflation, cost of goods sold, and price of commodities. The numbers have nearly multiplied by 1.5 in inflation since that time. You can do the math.Explain how inflation affect the function of money?
Inflation is defined as a persistent increase in general price level. Inflation is measured by the proportional changes over time in some appropriate price index, commonly a consumer price index. General Price level refers to an average of all price in an economy and changes in reflect in the cost of living.
Inflation however affects many thing one being function of money such as medium of exchange, store of value, unit of account and standard of deferred payments.
Medium of exchange means that any item that is widely acceptable in exchange of goods and services. The existence of a medium allows trade to take place without the need for a joint coincidence of wants. A medium of exchange facilitates economic transactions. As long as the same money is going to be accepted as payment, inflation will not affect this function. But in extreme cases of inflation, people may lose confidence in money to the extent that they don't trust it, and resort to barter or some other means of conducting transactions.
Another function of money is store of value. If asset prices are stable, money is unattractive as a store of value, as it brings in no income, but if asset prices are unstable it may be worth holding some part of total assets in money, as a safeguard against risk. This is the one that inflation obviously affects the most. Inflation erodes the value of money; it does not keep its value. Something that costs a certain amount today will cost more tomorrow. This affects everything from the timing of transactions to the amount required for future payments (interest rates).
One of the roles of money is to be the unit of account in which contracts are expressed and individual incomes or firms' profits are measured. High and fluctuating rates of inflation interfere with the performance of money as a unit of account, which is believed to be bad for the efficiency and equitable running of the economy.
Who gets hurt the most by inflation?
Almost everyone. It would be easier to list those who would not be hurt. Certain investors and stocks/shares speculators would not be hurt as far as their investment goes but they would be adversely affected in other areas. Inflation (very simply put) means that the monetary value of something increases. If it is prices then people have to pay more. If it is wages then the employers have to charge more for their goods or services. In theory, if there were no inflation of any type, then the entire economy would remain stable. However this is not possible in a practical world. Because countries trade with each other, we all want to earn more etc then inflation will occur somewhere which in turn will affect (hurt) almost evryone to some extent.
What could you buy for a dollar in 1880?
According to the Consumer Price Index Inflation Calculator, one dollar in 1930 had the same buying power that $13.50 has in 2011. So whatever you can get for thirteen and a half bucks today, was about a dollar in 1930.
What speeds up the flow of investment and wages in the circular flow of the free-market system?
Antitrust laws
consumer-protection regulations
Does inflation affect exchange rates?
Simply put, low inflation rates means higher demand in market including demand from foreign markets. This is translated in the price quoted for imported items. Thus, as import is increased so does money outflow. This means more foreign currency are needed (bought) to buy imported items and relatively the value of local currency rates will be depreciated.
What is the value of a dollar now compared to 1920?
If you'd like to know an "exact" approximation, try this site which calculates dollar value based on inflation:
http://www.westegg.com/inflation/
Back a long time ago, money was worth more than it is today. Just getting a few dollars paw was considered a lot.
When inflation becomes a problem what action will fed likely take with regard to interest rates?
when inflation becomes a problem the action the fed will RAISE INTEREST to slow the economy down a little.
How much was 5 dollars worth in 1865?
As of May 2014, $5 in 1865 was worth about $67. A dollar today would of been about $.08 in 1865.
When adjusted for inflation which penny year is worth more?
1960 pennies are worth more. Wrong!.... 2008 are worth more... its about quantity not YEAR
Clever. But I would point out that the 1990 pennies would probably be worth the most due to the fact that they contain more copper =)
How much would 1 million dollars in 1890 be worth today?
Not sure but probably around 10 million dollars today
Why did the south suffer inflation as a result of the war?
The Confederate dollar was not based on gold or any other real assets. It was simply based on a promise to redeem the banknotes in the event of Southern victory, and consequent independence.
When it was clear that the South was bound to lose, after the double Union victories of July 1863, the currency went steadily downhill. After Lincoln won the 1864 election, it became worthless.
The circular flow of economic activity is characterized by?
How people produce (make money) and consume (spend money).
Why do Governments and economists worry about inflation?
Inflation is a general and sustained rise in the level of prices over two financial quarters in an economy. The government is worried about inflation because it has negative repercussions on its ability to achieve its macro- economic objectives.
For example, inflation could result in higher unemployment. Firms seek to cut costs during a period of inflation and could lay off workers.
How much was a ticket at the movies in 1950s?
That might depend upon the year and the stadium. I attended Yankee games at Yankee Stadium in the mid 1950s. You could sit in the bleachers for .75 cents. Second tier seats were $1.25, and box seats might go as high as $5 or $10!!
Comparison between Alfred marshall and robin's definition of economics?
The comparism between the definition of economics given by Alfred Marshall & Robbins is that it both studies human behaviors.
Differences demand-pull inflation and cost-push inflation?
Demand-pull inflation: prices rise due to shortage; firms produce more and raise price to meet demand.
Cost-push inflation: prices rise due to increasing costs of production; firms raise price in order to not produce less.
