Chapter 26 Econ info

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Draggable item		Corresponding Item
Consumer Price Index		Price rises are followed by demands for higher wages which in turn cause costs to rise making workers demand more rises to compensate them for rising cost of living and so on.
Wage-price spiral		Inflation caused by a rise in business costs e.g. production costs which firms pass on to consumers so as not to reduce their profits
Interest rates		Inflation caused by aggregate demand rising faster than output and supply
Hyperinflation		A situation where inflation and unemployment are high and/or rising together
Stagflation		Measure of the general price level, includes a way of expressing the changes in the prices of a number of different products
Cost-push inflation		Rate at which of prices rise, a general and continuing rise in prices
Inflation		A period where the level of demand is g general and sustained fall in the general level of prices in the economy
Monetarists		Runaway inflation during which prices rise at a phenomenal rate and money becomes almost worthless
Menu costs		A person’s income in terms of what it can buy
Aggregate demand		Total demand in the economy including consumption, investment, government expenditure and exports minus imports
Deflation		Price paid to lenders for borrowed money. It is the cost of borrowing
Shoe leather costs		Economists who believe there is a strong link between growth
Purchasing power of money		Amount goods and services
Demand-pull inflation		Costs to firms of having to make repeated price changes
Real income		Costs to firms and consumers of searching for new suppliers when inflation is high