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| Topic: |
Business
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| Number of pages / Number of words: |
3 / 788 |
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Money is destroying when lenders repay bank loans.
To achieve the balance between the real GDP that means Gross Domestic Product will increase with increasing money supply. High levels of money in the system will spur on investment and industrial consumer demand. Any measure that drains money out of the system acts as a disincentive to lower spending and investments; this will lower the Gross Domestic Product...
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While increasing the money supply is a good sign for the GDP, it is not the same for inflation. With the increase, the nominal value of money stays the same, but the increase in money continues to chase the same quantity of goods and services?thus the real value of money is decreased. The result is prices go up...
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