What is inflation, Macroeconomics

Assignment Help:

Q. What is Inflation?

Inflation between two points in time is defined as percentage increase of price index between these two points in time. 

Comments:

  • Price index is calculated at a certain point in time, inflation over a time period, characteristically one year
  • Inflation may just as well be defined as percentage change in the price level.
  • Inflation is independent of which year we use as our base year for our price index.
  • Youfrequently hear that inflation is 'percentage change in prices'though keep in mind that 'prices' is then short for the price level.
  • Becausethe price level may be defined in several different ways (using different goods and different weights in the basket), inflation can be defined in several different ways.
  • if the price index reduces between two points in time we say that inflation is negative or that we have deflation.

 


Related Discussions:- What is inflation

Mec, discuss mec

discuss mec

International trade and Economic growth, If real GDP was $13.1 trillion in ...

If real GDP was $13.1 trillion in 2013 and $13.3 in 2014, what is the growth rate? (b) How many years would it take for GDP (gross domestic product) to double (using your answer fr

Exchange rate management, Exchange Rate Management: Following two  sta...

Exchange Rate Management: Following two  stage devaluation of the Indian rupee  in quick succession in July 1991, the  government introduced Liberalized  Exchange Rate System

Explain the competitive model, Identify and explain the evidence for and ag...

Identify and explain the evidence for and against the competitive model. Provide specific examples.

Agency decides to hire operators, An agency is having problems with persona...

An agency is having problems with personal phone calls made during working hours. Each minute of a personal call costs the agency $0.50 in wasted wages. The agency decides to hire

Major union wage settlement, Show the effects on the price level and real G...

Show the effects on the price level and real GDP of a major union wage settlement that significantly increases wages. Is this a supply shock, a demand shock, or both?

Government revenue, Government revenue, government spending and net exports...

Government revenue, government spending and net exports  G, NT and NX are exogenous variables in the classical model In the classical model (and

Economy is characterized, Suppose that the economy is characterized by the ...

Suppose that the economy is characterized by the following behavioral equations: C= 170 + 0.7YD I= 170 G= 150 T= 100 a. What does equilibrium output equal? Y=? b. What d

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd