Inflation and Deflation are defined as the the rise and fall of prices for good and services. When prices rise this is called inflation, when prices fall this is called deflation.
Together they form a delicate balance that is known as economic condition. Published: Mon, 5 Dec 2016 Introduction: In economy, inflation decreases the actual value of money, whereas deflation escalates the actual value of money; as in deflation there is continual decrease in the price of goods Inflation occurs when the price of goods and services rise, while deflation occurs when those prices decrease.
The balance between the two economic conditions, opposites of the same coin, is Inflation is an increase in those prices, deflation is a drop in those prices. Controlling Deflation Just like inflation, the government wants deflation to hover around 23.
The difference between inflation and deflation is presented here in tabular form and points. The two terms are completely opposite to each other. The first and foremost difference is When the value of money decreases in the world market, it is inflation, while if the value of money rises then it is deflation. This free Miscellaneous essay on Essay: Consequences of inflation and deflation is perfect for Miscellaneous students to use as an example.
Deflation is no worse than inflation both indicate problems in the economy. The good thing about inflation is that interest rates fall, allowing businesses to invest cheaply in new equipment. This makes businesses more efficient and therefore able to make money with decreasing prices. Grade inflation and deflation are not phenomena related to student performance as much as they are related to college grading policy.
For instance, a few years back, Princeton had a rule where only the top 35 of students would be able to earn As (dont worry, its not a thing anymore ). Inflation is when prices rise, and deflation is when prices fall. You can have both inflation and deflation at the same time in various asset classes. When taken to their extremes, both are bad for economic growth, but for different reasons. Rick, as far as the inflation vs. deflation thing goes you are way behind the eight ball.
Prices have been rising for the last 100 years. Yes, there have been hiccups along the way and Im sure well see more in the future.