--%>
Assignment Help - homework help

Inflation

Inflation is frequently described as "too much money chasing too few goods." Is this a satisfactory definition?

E

Expert

Verified

Inflation is a persistent rise in price level. Prices are derived by the interaction between demand and supply. Price rises when demand rises without any rise in supply OR supply falls without demand unchanged. When there is more money (demand) than what is available on sale (supply) we have inflation. Too few goods refers to low supply in comparison with high demand that is fuelled by too much money.

   Related Questions in Macroeconomics

  • Q : Backward shifting of incidence tax When

    When firms bear the legal incidence of a tax, this is backward shifted while: (1) firms burden consumers by raising their prices. (2) the tax burden is borne by workers in the form of lower wages. (3) resource suppliers seek higher factor payments to

    		•
  • Q : Example of microeconomic issue Hey

    Hey friends i need your support for justify the problem that is given below: If the United Auto Workers Union acquires benefit package and a large wage from GM, Ford, and Chrysler which increases the cost of U.S. cars, it is a

  • Q : Article on Agriculture and economic

    Read the article on blackboard in the assignments area, John McCallum "Agriculture and economic development in Ontario and Quebec until 1870", Gordon Laxer, ed. Perspectives on Canadian Economic Development: Class, Staples, Gender and Elites (Toronto: Oxford Universit

    		•
  • Q : Microeconomic analysis emphasizing to

    Family member to macroeconomics, the microeconomic analysis: (w) was emphasized through economists prior to the Great Depression. (x) is related with the effects of extensive government policies. (y) focuses upon economic development

    		•
  • Q : Market Supply versus Individual Supply

    What is the basic difference between Market Supply and Individual Supply?

    		•
  • Q : The failure of the Supercommittee

    Question: Some commentators have argued that the failure of the "Supercommittee" is good thing for the economy?  Do you argree? Answer:

    Q : Supply factors in economic growth

    Briefly explain the four supply factors in economic growth?

    		•
  • Q : Agency function of Commercial Bank Name

    Name the six agency function of Commercial Bank. Answer: A) Transfer of funds B) Collection of funds C) Purchase and sale of securities. D) Collection of dividends E) Payment of bills &

    		•
  • Q : Aggregate Expenditure model Describe

    Describe Aggregate Expenditure model and also state AD/AS model?

    		•
  • Q : Expanding consumption of a good I have

    I have a problem in economics on Expanding consumption of a good. Please help me in the following question. Your consumption of a good tends to expand if it’s: (i) Relative marginal utility surpasses its relative price. (ii) Total utility is les

    		•