Inflation 0.0 / 5 ? EconomicsInflationIGCSEEdexcel Created by: tsalomrobertsCreated on: 03-02-21 17:04 What is inflation/deflation A general and continuing rise in prices. A fall in average prices. 1 of 6 How is inflation measured? Consumer Price Index. (a measure of avg prices cal from the same price) 2 of 6 Describe Demand-Pull inflation Caused by too much demand. From rising consumer spending, or sharp increases in gov spending. 3 of 6 Describe Cost-Push Inflation Caused by rising costs. From increase wages, increases in tax 4 of 6 Relationship between inflation and interest rates Link between inflation and growth in money supply. Cause households borrow more money from banks to fund extra spending. 5 of 6 Impact of inflation Prices. Wages. Exports. Unemployment. Menu costs. Shoe Leather costs. Uncertainty. Business and Consumer Confidence. Investment 6 of 6
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