Question

The question is like an essay..

A HYPOTHETICAL EONOMY HAS A YEAR _ END INFLATION RATE OF 3.2. IN NO MORE THAN FIVE LINES OF TYPED TEXT BELOW, THIS QUESTION EXPLAIN WHAT THIS MEANS

Answer 1

In economic terms, an inflation rate of 3.2 will be seen as a moderate or low inflation rate. This will indicate that the price levels of the products and services in the economy are relatively low and thus the consumers will be able to buy more quantities of products and services. Low inflation also induces the chances of borrowing more money as the interest rates are normally at a lower side when the inflation rates are low. Due to increased consumption of the products, there will be more investment in the economy and the demand for the labors will increase improving the situation of unemployment in the economy.

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