Costs of Inflation

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  • Created by: Ben
  • Created on: 12-05-13 13:13

The Impact of Inflation

Here are 3 examples of the consequences of inflation:

  • Loss in international competitiveness - if the inflation rate in the UK is higher than the inflation rate of trading partners then UK produced are less competitive.
  • Fiscal Drag - if the tax brackets are not adjusted in line with inflation, people's income may be pushed into a higher tax band.
  • Shoeleather Costs -

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