Friday
March 27, 2015

Homework Help: eco

Posted by anonymous on Sunday, July 8, 2007 at 5:27pm.

why is inflation so widely feared?

During inflationary times, prices increase, but wages often don't go up as fast as prices.

Check this site for more information.

http://en.wikipedia.org/wiki/Inflation

Inflation is a major disadvantage to certain groups.

Keep in mind the major element in the definition of inflation is rising prices.

One group that it harms are those who are on fixed incomes. Inflation means that the prices that people pay for necessities such as rent, ford clothing and in today's time gasoline goes up. At the same time their fixed income(money) remains the same. These people, therefore, find that they can buy fewer goods and services with the money that they receive.

Another group that is harmed are those who are creditors. These are the peopleor institutions to whom money is owed. When the debts are paid back they are paid back with money that is worth less (cheap money).

There are other effects of inflation such as rising interest rates and the stock and bond markets,

Bear in mind that some groups benefit from the rise of prices.

Answer this Question

First Name:
School Subject:
Answer:

Related Questions

social studies - what are the type of rocks used to build the agra fort , gate ...
geography/geology - i need a brief geological history of region where gabbro, ...
SoCiAl(again) - Which Enlightenment writer expressed the idea that the ...
help! - How are physical characteristics combined with behavioral ...
Comp. - Could anyone help me Please.. about the uses of the computer on the ...
science - what is the relation between a solide and a liquid Well ice can turn ...
7th grade science help - why is the process that takes place in mitochondria ...
anatomy - Is this correct for the cellular organelles: riboncoine. mitochondrion...
History - Describe a major result of the Civil War on the US. Was the result ...
Biology - how does the structure of green cell organelles relate to the ...

Members