3 Limitations of Consumer Price Index as a measure of inflation?
1.Different population groups experience different rates of inflation will not be representative of individual households 2.Doesnt include house prices 3.May over estimate inflation
1 of 4
4 Sources of cost push inflation?
1.Rise in costs of imported raw materials 2.Rising labour costs 3.Higher indirect taxes 4.Wage price spirals
2 of 4
9 Consequences of inflation?
1.International competitiveness 2.Effect on investment 3.Unanticipated inflation 4.Menu costs 5.Shoe leather costs 6.Effect on distribution of income 7.Worsening industrial relations 8.Fiscal drag 9.Hyper inflation
3 of 4
Define 'M' 'V' 'P' 'T' AND 'Y' in the quantity theory of money?
M=Money Supply V=Velocity of circulation of money P=General price level T=Transactions equivalent to output Y=Real value of national output (real GDP)
4 of 4
Other cards in this set
Card 2
Front
4 Sources of cost push inflation?
Back
1.Rise in costs of imported raw materials 2.Rising labour costs 3.Higher indirect taxes 4.Wage price spirals
Card 3
Front
9 Consequences of inflation?
Back
Card 4
Front
Define 'M' 'V' 'P' 'T' AND 'Y' in the quantity theory of money?
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