Inflation And Deflation - 1067 Words

I’ll admit that before this semester I couldn’t tell you the difference between inflation and deflation or what economics was. My passion and interest was concentrated onto the medical field. Economics has become something of a challenge for me and I’m enjoying the process of learning what it is. I know that in 2007, we entered the Great Recession which we are still recovering from. The U.S. economy is something of uncertainty due to the change in supply and demand. I believe that the current U.S. economy kept its head above water due to the Government watching how much consumers were paying for products and the actual listed prices by producers. The U.S. economy might not be in a recession currently but we are still in a fragile state due to our liabilities exceeding our assets. It’s crazy to think that the current debt is $19,470,383,603,813.73 and growing. (http://www.usgovernmentdebt.us/) When the U.S. economy entered the Great Recession in 2007, I was entering the workforce for the first time and I had to battle for my spot in the workforce. As a middle class working citizen I felt the changes in the economy on the daily basis. Being a freshman in college, I had many new expenses that included a car payment, school loans, and a mortgage. This was a troubling time because my interest rate and hidden fees were outrages due to the instability of mortgage companies and the fragile state of the economy. During this period of time there were many families that were unable toShow MoreRelatedDeflation And Inflation1647 Words   |  7 PagesAn Analyzation of Deflation and Inflation Whether the world sees falling prices or rising prices is a day to day change. These rising and falling prices are known as inflation and deflation. Inflation is an increase in all of the prices of goods and services in the economy, while deflation is the decrease of all prices. These price changes are written about in hundreds of articles everyday all around the world. I recently read two articles published by The Economist while compiling informationRead MoreCauses of Inflation and Deflation2181 Words   |  9 PagesAID OF DIAGRAMS, ILLUSTRATE THE CAUSES OF INFLATION AND DEFLATION, AND BY COMPARING THEIR ECONOMIC EFFECTS CONSIDER HOW BOTH CAN AFFECT THE CORPORATE SECTOR. The essay will describe causes of inflation and deflation and explain how they can affect the corporate sector. 1. INTRODUCTION DEFINITION OF INFLATION AND DEFLATION Inflation is a process in which the price level is rising and money is losing value. (Parkin, Powell, Matthews p654) Inflation tends to rise when at the current priceRead MoreThe Monetary Policy Roller Coaster1193 Words   |  5 Pagesstabilize prices. We can look at this and picture the government’s desire to a keep a low and stable rate of inflation. The reason for this is because there are a numerous of negative impacts associated with the high levels of inflation, such as, the loss of purchasing power just to name the big one. But what happens when there is a deflation? Monetary Policy and the concepts of Inflation and deflation play a huge role in our economy along with the enduring changes that take place with the Aggregate SupplyRead MoreInflation Is The Rise Of Priced Goods And The Fall Of Value Of Money989 Words   |  4 PagesECON-50-16209 SU 2016 [ Erica Vergara, ID#0678025 ] Essay 1: Question 1: Inflation is the rise of priced goods and the fall in value of money. Deflation is when prices of good and services fall. We are concerned about both because they can harm the economy. In the video, â€Å"Inflation or Deflation?† by Merle Hazard, he asks if the banks will the central bank get traction soon or will it lose its grip? In regards to being in a recession, Hazard is questioning if the banks will be able to control whatRead MoreMacroeconomic Factors That Affect An Economy967 Words   |  4 PagesProduct(GDP), Monetary policy, Fiscal Policy, Interest rate, Inflation, Deflation, Unemployment, economic growth etc. Many people accept inflation as a fact of life but sometimes under some economic circumstances opposite situation take place, which we call† Deflation†. It is also known as Negative Inflation Rate (when inflation rate decreased below 0%). Moreover, deflation is an indication of declining economic condition. Answer-1 Definition: â€Å"Deflation is the reduction of prices of goods means general priceRead MoreA Lecture At The George Washington University1142 Words   |  5 Pageshighlighted the damage deflation caused during the Great Depression. The gold standard and errors by monetary policymakers in the period exacerbated a difficult situation and allowed deflationary forces to spread financial distress and panic in the banking sector. The Chairman argued that had the Federal Reserve expanded the money supply during the Great Depression, deflation could have abated and the severity of the financial crisis would have been avoided. In recent years, deflation has returned toRead MoreInflation and Its Effect on Retailers1723 Words   |  7 Pagess Inflation and its effect on Supply Chain Industry (Retail) By Kamal Deep Introduction This white paper details out how inflation is affecting the Retail economy and its health. This paper also suggests what care needs to be taken by the Retailers for tackling inflation. Purpose of this Project For applying the Macro Economics class room learning’s practically Scope ofRead MoreA Better Monetary Policy Central1612 Words   |  7 PagesA Better Monetary Policy Central Banks Should Adopt in the Environment of Low Inflation CONTENTS 1 Introduction 2 2 Problems 2 2.1 Low Inflation Retards Economic Recovery 2 2.1 It Remains Questionable Which Monetary Policy is Better 3 3 Comparison Between Interest Rate Policy and Money Supply Policy 3 3.1 The Advantages and Drawbacks of Lowering Interest Rate 3 3.2 The Advantages and Drawbacks of Increasing Money Supply 4 4 Conclusion 5 5 List of References 6 Keywords: Monetary Policy; InterestRead MoreInflation Is A Low Rate Of Inflation1726 Words   |  7 Pageshas a high rate of inflation, that means people who live in this country are sad. Inflation has many definitions, but most of these definitions are related to one concept which is inflation is a general increase in prices and fall in the purchasing value of money. There is no doubt about that inflation is an important key concept in economics. As we know that there is something called deflation which is the opposite meaning of inflation. In this paper, I will write about inflation in general, the causesRead MoreScholarly Journals On The Other Hand916 Words   |  4 Pagesearly 1970’s. However, the UK went back into a deficit. Britain’s annual CPI inflation rate also increased from 2.2 (1967) to 9.5 (1971). Experts believe that without devaluation, UK’s interest rates could’ve gotten even higher and they would’ve faced deflationary pressure. In 2002, the Argentina government devalued the peso after a deep recession. This disaster began in the 1980s when Argentina faced high inflation rates and dreadful debt. Insurmountable debt grew due to poor tax collection,