Back to category: Business

Limited version - please login or register to view the entire paper.

INFLATION:What are the two principle causes of inflation?

INFLATION

The causes of inflation are intertwined, entangled, complex and complicated to take apart. The two principle causes of inflation are demand-pull and cost-push. Both these theories of inflation are connected to one essential aspect – the impracticable expectations of people and their challenges to get more out of the economy than the economy can manufacture. Inflation is an increase in the general level of the prices of goods and services. Inflation is the overall general upward price movement of goods and services in an economy, usually measured by the Consumer Price Index. Over time, as the cost of goods and services increase, the value of a dollar is going to fall because a person won't be able to purchase as much with that dollar as he/she previously could. During periods of inflation, salaries and incomes tend to rise speedily.
When investigating the causes of inflation, it is useful to look at the fundamental notions and thoughts of the demand sid...

Posted by: Chad Boger

Limited version - please login or register to view the entire paper.