The Main Causes of Inflation (HSC SSCE Economics): Flashcards
📚Flashcards
Practise the cards
10 cards from this deck
ShowHide
Practise the cards
10 cards from this deck
Four primary causes of inflation
Four primary causes of inflation
Demand-pull, cost-push, expectations, imported inflation
Demand-pull inflation occurs when
Demand-pull inflation occurs when
Total spending exceeds productive capacity
Cost-push inflation arises from
Cost-push inflation arises from
Rising production costs
Labour costs as % of firm's total expenses
Labour costs as % of firm's total expenses
Around 60%
Nature of inflationary expectations
Nature of inflationary expectations
Self-fulfilling prophecy
Imported inflation definition
Imported inflation definition
Price rises via international transactions
Effect of AUD depreciation on imports
Effect of AUD depreciation on imports
Makes imports more expensive
GST introduction impact on 2001 inflation
GST introduction impact on 2001 inflation
Raised headline inflation to 6.1%
Equation of exchange
Equation of exchange
(money, velocity, price, output)
Australia's headline inflation peak (Dec 2022)
Australia's headline inflation peak (Dec 2022)
7.8%