Inflation
What is deflation?
Falling average prices over time.
What is the labour force?
People aged 16–65 willing and able to work.
What is an interest rate?
The cost of borrowing or reward for saving.
What is importing?
Buying goods or services from other countries.
A sustained rise in the general level of prices measured by the CPI.
Inflation
The term when almost everyone in the labour force is employed.
Full Employment
Do high interest rates encourage or discourage spending?
encourage
The difference between the value of exported and imported goods.
Balance of Trade
What kind of inflation happens when high consumer demand for goods or services pushes prices upward.
Demand Pull inflation
What happens as a result of high unemployment?
Losing jobs, falling income, and lower living standards occur during this.
People with existing loans pay more under this condition.
High Interest rates
What is imported inflation?
When imported raw materials cost more, causing price rises.
Explain cost-push inflation
Cost-push inflation occurs when rising production costs force businesses to raise the prices of goods and services.
When a company or individual from one country invests in business assets or operations in another country.
FDI, or foreign direct investment
Low rates encourage borrowing but discourage this.
Saving
What is the black or shadow economy?
The shadow or black economy is the part of economic activity that is unrecorded, untaxed, and outside government regulation.