Essay on Inflation

When thinking about problems in the economy, inflation may be one of the most popular topics. However, deflation may be just as damaging, if not, more damaging than inflation. When deflation occurs, the consumer, the government, and the global economy are all effected. Not all deflation cases are negative, but the ones that are negative are the ones that the policy makers have to focus on and try to prevent. Deflation comes in two different forms. One kind of deflation is malign deflation.…

relationship between inflation and the economic growth, for a very long period of time. The combination of the two, that is inflation and economic growth, they distinguish the variables of macro-economic. Inflation has a negative impact on the growth of the country; the South African statistics has proven that. I will be discussing that in details. Firstly, Inflation is simply defined as a situation where prices are perpetually and remarkably increasing in general. My definition of inflation is…

Introduction Inflation is defined as the sustained increase in the general price level of goods and services in an economy over a period of time. When the general price level rises, each unit of currency buys fewer buys fewer goods and services. Accordingly, inflation reflects a drop in the purchase power per unit of money, a loss of real value in the medium of exchange and unit of account within the economy. A major measure of price inflation is the inflation rate, the annualised percentage…

One important issue that Millennials overlook when saving for retirement are inflation rates. When saving in retirement accounts, it is best to know that inflation will affect present dollars put into the account in the future. Inflation rates reduce purchasing power and the interest rate in your savings account will likely be below the rate of inflation. The rate of inflation is increasing more than the amount of the savings account. Also, budgets are important to help Millennials have enough…

Inflation is the “increase in the general price level of goods and services in an economy” (Heakak, 2017). Inflation can be broken down into different types, resulting from different situation in the economy. When there is a change in the supply side of the economy, cost-push inflation occurs. On the other hand, when there is a change in the demand side of the economy, demand-pull inflation occurs (Surbhi, 2017). Deflation and disinflation help to describe the level of inflation is in an economy…

The figure above showed inflation rates from year 2007 to year 2012. In year 2007, the inflation rate is 4.10% and plummeted down to 0.10% in 2008. However, this inflation value increase in the year 2009 to 2.7% and drop to 1.5% in 2010. From 1.5%, the inflation rate risen up to 3% in 2011. In year 2012, the inflation rate is 1.7%. The pattern of the inflation rates between these years is inconsistent. (“Current US Inflation Rates: 2005-2015”) High inflation rates between the years of 2007 to…

If you bought a house for $150,000 with an annual inflation rate of 4 percent, it would take about 18 years for the house’s worth to double based on the Rule of 72. b. If you bought a Picasso painting at last week 's auction for $200,000 and the annual inflation rate is 10 percent, how long would it take to double your money? If you bought a painting by Picasso for $200,000 with an annual inflation rate of 10 percent, it would take around 7 years for the painting’s worth to double. c. If…

“The Federal Reserve plays a major role in controlling unemployment and inflation. They rely on economists to give them data in order to control these areas. The economists use data to determine if the economy is growing or shrinking in size, the measure of total output calls the real gross domestic product is used. The real gross domestic product (Real GDP) is the market value of all final goods and services produced within a country in a giving period. Every legal goods and services paid for…

Inflation and its impact in India What is Inflation Imagine we had Rs.7 in 2003. One could have purchased a 300 ml Pepsi and gone home happy (excluding the Rs. 2 that shopkeepers charge for refrigerating it). Fast forward 12 years and on would have to shell out Rs.15 to purchase the same 300ml Pepsi bottle. What happened? One would think Indra Nooyi has fleeced us, but in reality, the value of money has reduced. This is attributable to inflation. Inflation is defined as a sustained increase…

the rate of inflation, as measured by CPI, was 3.4% but in 1974, it increased to about 12.2%. The main contributors to this rapid increase are several, but food prices and energy costs were the main culprits. . (Blinder, 1982) As stated before, food costs rose dramatically due to weather in 1972, which it affects were later felt in the form inflation in the next year. This inflationary effect from 1972-1973 was a 20% increase. (Blinder, 1982) The author Alan Blinder suggests that inflation…