Difference between anticipated and unanticipated inflation, Microeconomics

Explain inflation, and the difference between anticipated and unanticipated inflation.        


Inflation is the persistent rise in the general price level in the economy.      

Anticipated inflation-

1) If the rate of inflation is anticipated then people take steps to make suitable adjustments in their contracts to avoid the adverse effects which inflation could bring to them

2)  Its effects are less substantial and less harmful

3)  Effects of anticipated inflation are avoidable.

Unanticipated inflation

1)  If the rate of inflation is unanticipated then people cannot make necessary adjustments in their contracts as they do not know what will be the rise in price level.

2)  Its effects are more substantial and more harmful

3)  Effects of unanticipated inflation are unavoidable.


Posted Date: 3/12/2013 4:07:48 AM | Location : United States

Related Discussions:- Difference between anticipated and unanticipated inflation, Assignment Help, Ask Question on Difference between anticipated and unanticipated inflation, Get Answer, Expert's Help, Difference between anticipated and unanticipated inflation Discussions

Write discussion on Difference between anticipated and unanticipated inflation
Your posts are moderated
Related Questions
Question 1: "The rush of new and existing enterprises to exploit the opportunities presented by the internet economy is giving rise to new business models". Discuss. Ques

What is the importance of microeconomics in study of managerial economics?   Normal 0 false false false EN-IN X-NONE X-NONE

Time is a significant determinant of price elasticity.  If a price changes, it might take consumers a certain amount of time to discover alternative lifestyles or commodities to ac

hi, how much does it cost for you guys to write a 5-6 pages on a article on supply and demand? However, on the 5-6 pages it wont all be writings..i need a few graphs. i would need

If coolest icecream parlor has been closing at 5pm with $120 of marginal revenue and $80 of marginal cost for the last hour open, what should coolest icecream do to maximize profit

Defining black economy, If you pay your cleaner or builder in cash or for some reason neglect to tell the taxman which you were paid for a service rendered, you participate in the

explain slutsky theorm with graphical representation

using necessary and sufficient condition explain consumer surplus diagrammically and mathematically?

Problem 1: a. Describe the concept of opportunity cost, using the production possibility curve. b. What are the fundamental problems of an economy? Describe how the command

Low levels of productivity: In addition to low standards of living, developing countries are characterized by relatively low levels of labour productivity. Throughout the dev