what is deflation in economics
Problems of deflation – Economics Help
Deflation is defined as a fall in the general price level. It is a negative rate of inflation. The problem with deflation is that often it can contribute to lower economic growth. This is because deflation increases the real value of debt – and therefore reducing the spending power of firms and consumers. Also falling prices can discourage …
Consequences of Deflation | Economics | tutor2u
Deflation is a sustained decrease in the overall price level of goods and services in an economy. It can be economically damaging for a number of reasons Decrease in consumer spending When prices are falling consumers may delay purchases in the hope of getting a better deal in the future.
Why Is Deflation Bad for the Economy? – Investopedia
Deflation is when the prices of goods and services decrease across the entire economy increasing the purchasing power of consumers. It is the opposite of inflation and can be considered bad for a …
What is Deflation? Definition Causes & Consequences
Deflation is a decrease in the general price level in the economy. When deflation occurs the overall price level across the economy falls. This means that the purchasing power of an individuals money actually increased. As prices fall the value of the currency increases. One unit of currency can purchase more goods.
Inflation – Wikipedia
Other economic concepts related to inflation include deflation – a fall in the general price level; disinflation – a decrease in the rate of inflation; hyperinflation – an out-of-control inflationary spiral; stagflation – a combination of inflation slow economic growth and high unemployment; reflation – an attempt to raise the …
Deflation in Economics | Meaning Examples Causes Effects
Deflation Inflation Disinflation Meaning Deflation is a decrease in the general price level of goods and services. Inflation is the increase in the general price level of goods and services. Disinflation is a decrease in the rate of inflation or equivalently an increase in deflation. Causes
Deflation Definition – Economics Help
Deflation is defined as a decrease in the general price level. It is a negative inflation rate. Deflation means the value of money will increase. Deflation is often associated with periods of negative or stagnant economic growth (Great Depression Japanese economy in the 1990s early 2000s). In fact deflation is often used to express a …