Buy custom The last ten year's price stability recorded
Essay's paper info
Topic: |
Business
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Number of pages / Number of words: |
8 / 2120 |
Essay's paper body
To bring the macro-economic stabilization we need to control inflation as it dismissed the price level stability and that will affect the factors of market and bring the disequilibrium in the economy.
2. An increase in the price level reduces the real money stock.
3. It reduces real balance and raises interest rates and reducing investment, aggregate spending and hence Equilibrium income...
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It reduces real balance and raises interest rates and reducing investment, aggregate spending and hence Equilibrium income.
4. It affects the demand and supply of the market.
5. It has direct effect on the general consumers. When prices are stable or fluctuate within a narrow range, individual's frame expectations about normal prices are based on past experience...
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General points of the essay
Explain what is meant by the term “financial stability” and discuss the underlying trends that have prompted policymakers to give greater emphasis to financial stability as an economic objective.
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