Inflation, Managerial Economics

Meaning

The word inflation has at least four meanings.

  • A persistent rise in the general level of prices, or alternatively a persistent falls in the value of money.
  • Any increase in the quantity of money, however small can be regarded as inflationary.
  • Inflation can also be regarded to refer to a situation where the volume of purchasing power is persistently running ahead of the output of goods and services, so that there is a continuous tendency of prices - both of commodities and factors of production - to rise because the supply of goods and services and factors of production fails to keep pace with demand for them. This type of inflation can, therefore, be described as persistent/creeping inflation.
  • Finally inflation can also mean runaway inflation or hyper-inflation or galloping inflation where a persistent inflation gets out of control and the value of money declines rapidly to a tiny fraction of its former value and eventually to almost nothing, so that a new currency has to be adopted.
Posted Date: 11/30/2012 4:42:00 AM | Location : United States







Related Discussions:- Inflation, Assignment Help, Ask Question on Inflation, Get Answer, Expert's Help, Inflation Discussions

Write discussion on Inflation
Your posts are moderated
Related Questions
State the Meaning of managerial economics Managerial economics, used synonymously with business economics, is a study of economics that deals with the application of microecono

PUBLIC EXPENDITURE The accounts of the central government are centered on two funds, the Consolidated Fund, which handles the revenues form taxation and other miscellaneous re

Producers Equilibrium or Optimal Combination of Inputs  The analysis of production function has demonstrated that alternative combinations of factors of production that are tech

Arguments against Monopoly However monopolies have been accused of the following weaknesses. Diseconomies of scale While the monopolistic firm ca

What is an effective need of demand 1.  An Effective Need: Effective need demands that there must be a need supported by the capacity and readiness to shell out. Henceforth there

Explain important terms of marginal productivity and wage inequality Marginal Productivity and Wage Inequality: a. Market power • Compensating Differentials • Dang

State the Demand analysis Analysis of demand is assumed to forecast demand that is a basic component in managerial decision-making. Demand forecasting is of importance since

SHORT RUN EQUILIBRIUM OF THE FIRM A firm is in equilibrium when it is maximizing its profits, and can't make bigger profits by altering the price and output level for its prod

Factors influencing demand for a product These are broadly divided into factors determining household demand and factors affecting market demand . Factors affecting hou

REGRESSIVE TAX A tax is said to be regressive when its burden falls more heavily on the poor than on  the rich.  No civilized government imposes a tax like this.