Inflation in Economics
Research Question: What are the effects of the inflation in economics and how can we control it?
Aim: The aim of this paper is to discuss the effects of inflation, both the advantages and disadvantages in the global economy.
Introduction elements (think of two hooks and choose one later)
Hook 1: Inflation in the economy has resulted in losses and business falling due to prices of goods and services falling (Arnold, 2010).
Hook 2: Inflation in economics has been a matter of discussion for centuries, and even currently it is further analyzed with the same interest.
Connecting information to thesis:
Point 1: What is inflation?
Point 2: How inflation is measured
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Point 3: Inflation and Interest Rates
Point 4: Inflation and Investments
Thesis statement; the advantages of inflation in economic are: it allows the wages to be adjusted, enables the moderation of relative prices, and in some instances, it can boost the growth of a business, while the disadvantages of inflation are: increases the real value of debt, and scares investors to invest their money.
Body paragraphs:
- It allows the wages to be adjusted
- The company management will have adjusted the wages of their employees to suit the profits the organization is getting
- Response; importance of increasing the wages (Berlatsky, 2013).
- Response; the effects into causes to the organization
- Increasing the wages improves the morale of employees
- Response; the organization will get a boost in the production of services and goods because of the good work of the employees
- Enables the moderation of relative prices, and in some instances, it can boost the growth of a business
- The prices will also be adjusted to fit the situation of the economy
- Response; this situation will make the prices of commodities to go down or increase in favor of everyone.
- Response: this will improve the quality of product and services offered (Thornton & Ekelund, 2004).
- The growth of the business will increase
- Response; when the prices of the commodities are adjusted, the business will definitely grow since it encourage clients to buy.
- Disadvantage: Inflation scares investors invest their money
- Response; investors always look for a favorable background to invest their hard-earned money, thus, they will not risk if the situation is good (Mankiw, 2009).
- Response; lack of investment results to slow economic growth, hence, leading to poor business.
References
Arnold, R. A. (2010). Economics. Australia: South-Western Cengage Learning.
Berlatsky, N. (2013). Inflation. Detroit, MI: Greenhaven Press.
Mankiw, N. G. (2009). Principles of economics. Mason, OH: South-Western Cengage Learning.
Thornton, M., & Ekelund, R. B. (2004). Tariffs, blockades, and inflation: The economics of the
Civil War. Wilmington, DE: Scholarly Resources.
