Consequences of and Solutions to High Inflation

In this second lesson on inflation we'll outline its consequences and briefly introduce some possible solutions to the two different types of inflation.
Want to learn more about economics, or just be ready for an upcoming quiz, test or end of year exam? Jason Welker is available for tutoring, IB internal assessment and extended essay support, and other services to support economics students and teachers. Learn more here! econclassroom.c...

[@FatmataConteh-n5w]

Mr.Welker thank you so much

[@aidanaadilova]

Thank you so much! You made it easier in time of coronavirus when we have online lessons that harder to catch.

[@jaakkooksa5374]

If inflation tends to make real interest rates negative, why would anyone lend (or save) funds at such unfavorable terms, instead of converting them into something that is expected to retain or increase its real value, such as real estate, shares, gold, foreign currency or Inflation-Protected Securities?

[@amitrathi2766]

What is effect of inflation on debators and creditors

[@jaakkooksa5374]

Is it true that inflation causes short term real labor costs to decrease, which moves the aggregate supply curve to the right, which increases real GDP? If so, isn't this one of the benefits of inflation? Also, if the previous statement is true, then, ceteris paribus, the movement of the aggregate supply curve to the right ought to reduce the price level, which would act as a self-correcting mechanism for inflation, right? On the other hand, if the economy is at full employment, the aggregate supply curve cannot move to the right by very much, and if we are below full employment, then we are on the flat part of the short term aggregate supply curve, and in either case, ceteris paribus, real GDP would not rise by very much. This is confusing :-)

[@shienwang3686]

very interesting~~~~~~~~~~~~~

[@curtiswu7242]

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[@naffetiahmed7855]

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