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whats caused by too much money chasing too few goods?

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Q: Too much money chasing too few goods?
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Why did inflation set in during 1946?

Inflation is too much money chasing too few goods and services; in 1946, there was a lot of pent-up demand following the Depression and WW II, and lots of money that had been saved during WW II because there was nothing to spend it on.


Raising taxes can help control inflation because?

Inflation is too much money chasing too few goods. If the new revenue from raising taxes is used to pay down debt, raising taxes can help control inflation by reducing discretionary income.


How does inflation effect cost of capital?

Inflation is too many dollars chasing too few goods. It happens when the money supply is variable and the cost of borrowing from commercial lenders (1. federal reserve) is too low.


How is too much money chasing too few goods is a common way use to describe what economic concept?

In economic terms, it is scarcity.This is what drives inflation. The more money in the economy, the less it is worth. Consequently, as the value of the dollar goes down, the price of everything goes up. This is what is called an inverse relationship.


If too many people chasing few goods?

wand k kha lo


The causes and cure for inflation?

Essentially, it is too much money chasing too few goods or services. The causes of the excess of available money and the shortages of a good or service are almost limitless but some of them are; the government prints too much money, too much credit is available (This is more the problem in the recent past - credit cards alone have created more money than any gov't.). A sudden change in society ( A fad, a disaster or financial manipulation, for example) can create an excessive demand for a product or service.


What is a rapid increase in the price of goods caused by printing too much money?

Inflation.


What was the rapid increase in the price of goods caused by printing too much money?

Hyperinflation.


What is most likely to lead to an increase in the underlying rate of inflation?

Inflation at its core is a monetary problem. It is simply too much money chasing too few goods. The father of this theory is Milton Friedman (see link below).Rapidly rising production costs


What is a rapid increase in the price of goods caused by printing too much money called?

Hyperinflation.


What is a sharp continuing rise in prices caused by too much money and credit relative to the available goods?

inflation


If there is high inflation the federal reserve will want to increase the money supply?

One of the two (according to the Keynesian) reason that can create high inflation is attributed to the increased money supply where "too much money chasing too few goods" Therefore, to reduce inflation, the Federal reserve would want to DECREASE the money supply. However, the increase in money supply can create stimulus demand and depreciate the exchange rate of the US Dollars which are considered (although questionable) beneficial to the US economy.