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Discuss the possible implications of rising inflation for the UK
economy
(40 marks)


When the UK was in the recession banks were not willing to lend
cash unless people paid more in return (due to high interest rates).
The government needed to get people spending and that meant to
lower…

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will be too expensive. This means many businesses' will not get any
work and so go under. For us to import goods it would be very
good, and so imports would be cheap and so prices of products will
be cheaper due to the fall in the costs. This will…

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inflation to fall, but still this is only a theory and at some stage
inflation will get too high, especially with the Bank of England
considering more Quantitative easing. This means even with
inflation being at a high for a short period of time it will cause
major problems very…

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guarantee sales in large quantities unlike many other stores. This then helps
them as they can lower their prices, this would mean more sales would be
needed to gain a profit overall, but unlike others they would be able to do this.

In an economic downturn, consumers have less disposable…

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