The Importance Of Inflation In Brazil

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Register to read the introduction… Inflation is a rise in the general level of prices of goods and services in an economy. When this happenes it will mean that each unit of the currency will be able to buys fewer goods or services. In other word, inflation also reflects a loss of real value also known as an erosion in the purchasing power of money (Index Mundi, 2012). Inflation rate measures the rate of the rise or fall in prices or the value of the currency that consumers pays for goods and services. There are two types of inflation, one is cost-push inflation and another is demand-pull inflation. While the Cost-push inflation happens when there is an increase in the factors of production which means that organization will also rise the price of the product, the demand-pull inflation is when there is a high rate of demand at the same time there are scarce supply so organization will push the price up in order to try to gain more …show more content…
The unemployment rate in Brazil was last reported in 5.40% in September 2012.
Even with continues decrease in unemployment in Brazil it continues to be a big problem to the economical growth because there is no system of social protection. Another reason why this continues decrease in unemployment is still a problem is because Brazil’s population continue to bloom because large number of people migrates there. With the huge population there are approximately 40 million who lives below the poverty line while unemployment is a major cause for in equal distribution of wealth, benefits and social services in Brazil (Global Finance).
On top of that the privatization of many public services such as education, health services, public transportation, electricity to communication services, helps expands the distance between the rich and the poor. However by privatizing more products and service means that the country is in need of more labor to produce more goods. This will then continue to decrease the unemployment rate as shown in the yearly unemployment graph.
Correlation of Inflation and
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(2012, November 14). Retrieved November 29, 2012 from Brazil GDP - Per capita (PPP):
Index Mundi. (2012, November 15). Retrieved December 1, 2012 from Brazil Unemployment Rate:
Index Mundi. (2012, November 14). Retrieved November 28, 2012 from Brazil Inflation Rate: (2012, November 19). Retrieved December 1, 2012 from Inflation Brazil – current Brazilian inflation:
IMF. (2012, October 9). Retrieved November 28, 2012 from World Economic Outlook Database:
Maps of World. (n.d.). Retrieved Decemeber 1, 2012 from Brazil Economy:
McBride, B. (2009, November 7). Calculated Risk Finace & Economics. Retrieved Novemeber 30, 2012 from Unemployment and GDP:
Spark Notes. (n.d.). Retrieved December 2, 2012 from The Tradeoff Between Inflation and Unemployment:

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