Inflacion
Páginas: 3 (610 palabras)
Publicado: 23 de septiembre de 2012
1. Inflation
Recent history of inflation + nowadays rate of inflation: The inflation rate in Portugal was last reported at 3.8 percent in May of 2011. From 2002 until 2010, the average inflationrate in Portugal was 2.25 percent reaching an historical high of 4.20 percent in February of 2003 and a record low of -1.60 percent in June of 2009. Inflation rate refers to a general rise in pricesmeasured against a standard level of purchasing power. The most well known measures of Inflation are the CPI which measures consumer prices, and the GDP deflator, which measures inflation in the whole ofthe domestic economy.
Causes of inflation: There are many causes for inflation, depending on a number of factors. For example, inflation can happen when governments print an excess of money todeal with a crisis. As a result, prices end up rising at an extremely high speed to keep up with the currency surplus. This is called the demand-pull, in which prices are forced upwards because of ahigh demand.
Another common cause of inflation is a rise in production costs, which leads to an increase in the price of the final product. For example, if raw materials increase in price, this leadsto the cost of production increasing, this in turn leads to the company increasing prices to maintain steady profits. Rising labor costs can also lead to inflation. As workers demand wage increases,companies usually chose to pass on those costs to their customers.
Inflation can also be caused by international lending and national debts. As nations borrow money, they have to deal withinterests, which in the end cause prices to rise as a way of keeping up with their debts. A deep drop of the exchange rate can also result in inflation, as governments will have to deal with differences inthe import/export level.
* Costs of inflation:
* International competitiveness:
A relatively higher inflation rate will make portugal goods less competitive, leading to a fall in...
Recent history of inflation + nowadays rate of inflation: The inflation rate in Portugal was last reported at 3.8 percent in May of 2011. From 2002 until 2010, the average inflationrate in Portugal was 2.25 percent reaching an historical high of 4.20 percent in February of 2003 and a record low of -1.60 percent in June of 2009. Inflation rate refers to a general rise in pricesmeasured against a standard level of purchasing power. The most well known measures of Inflation are the CPI which measures consumer prices, and the GDP deflator, which measures inflation in the whole ofthe domestic economy.
Causes of inflation: There are many causes for inflation, depending on a number of factors. For example, inflation can happen when governments print an excess of money todeal with a crisis. As a result, prices end up rising at an extremely high speed to keep up with the currency surplus. This is called the demand-pull, in which prices are forced upwards because of ahigh demand.
Another common cause of inflation is a rise in production costs, which leads to an increase in the price of the final product. For example, if raw materials increase in price, this leadsto the cost of production increasing, this in turn leads to the company increasing prices to maintain steady profits. Rising labor costs can also lead to inflation. As workers demand wage increases,companies usually chose to pass on those costs to their customers.
Inflation can also be caused by international lending and national debts. As nations borrow money, they have to deal withinterests, which in the end cause prices to rise as a way of keeping up with their debts. A deep drop of the exchange rate can also result in inflation, as governments will have to deal with differences inthe import/export level.
* Costs of inflation:
* International competitiveness:
A relatively higher inflation rate will make portugal goods less competitive, leading to a fall in...
Leer documento completo
Regístrate para leer el documento completo.