inflation changes in pricing. price comparisons 1936 - $1989 2010 - $30,171 2012 - $110,000 1969 -...
TRANSCRIPT
Price Comparisons• 1936 - $1989• 2010 - $30,171• 2012 - $110,000
• 1969 - $3714• 2012 - $22,467• Mint - $67,700
• 1987 - $64.99• 2012 - $126.63• In Box - $500• Respectively - $33.13
Inflation
•Increase on average level of prices over time
AverageLevel ofPrices
Total G/SGDP/GNP
Q
$
AS
AD
Rate of Inflation
•Comparing the CPI of a base year to CPI of other years
•2-4 % is normal and good•Deflation – decrease in the average level
of prices
% = A – B x 100 A
Types of Inflation
•Creeping Inflation▫Low inflation for a long period of time
•Chronic Inflation▫Inflation steadily rising over a long period
of time•Hyperinflation
▫Out of control▫1000%
Theories
•Quantity▫Too much money in the economy▫More dollars are printed than the country’s
worth•Demand –Pull
▫Consumer demand is too high•Cost-Push
▫Costs of production decrease supply▫Costs shifted to consumers