Advantages and Disadvantages of Inflation?


There are a variety of advantages and disadvantages of inflation. For the advantages, moderate inflation enables adjustment of prices and wages, and inflation can also boost growth. As far as disadvantages, inflation tends to discourage investment and long term economic growth, and it also reduces the value of savings.
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Advantage. 1.people feel richer (money illusion) 2.unexpected inflation benefits borrowers. 3.could be from extra growth in the economy or extra money which would lead to lower unemployment
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Inflation is the decreased value of money. if inflation goes up it means that the prices of goods also go up. this may lead to workers demanding higher wages and result in less profit
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The Advantages & Disadvantages of Inflation
According to, "Inflation is defined as a sustained increase in the general level of prices for goods and services." In other words, the value of the dollar does not stay consistent during times of inflation, and the purchasing power of... More »
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The disadvantages of monetary policy include conflicting goals and time lag. The advantages of monetary policy include low inflation and political independence ...
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