The United States’ annual inflation rate has risen from 3.2 percent in 2011 to 4.7 percent in 2021. This suggests that the dollar’s purchasing power has deteriorated in recent years. Why does inflation increase year after year? Inflation is the rate at which the price of goods and services in a given economy rises. Inflation […]
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Inflation is a natural result of rising wages. This is essentially a mix of demand-pull and cost-push inflation. Firms’ costs rise as salaries rise, and these costs are passed on to customers in the form of increased pricing. Additionally, higher salaries provide customers with more discretionary income, resulting in increased spending and AD. In the
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Joe Biden should be thinking right now, “If you break it, you own it,” but he isn’t. Yes, it’s implausible that the president, who has earned the moniker “Sleepy Joe,” has enough self-awareness to own his involvement in fueling the US economy’s precarious position, which is currently experiencing a 40-year high of 7.9% (and rising)
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Retail and wholesale trade industries led the increase in private inventory investment. The largest contributor to retail was inventory investment by automobile dealers. Increases in both products and services contributed to the increase in exports. Consumer products, industrial supplies and materials, and foods, feeds, and beverages were the biggest contributions to the growth in goods
Has US GDP Increased? Read More »
The 1981-82 recession was the greatest economic slump in the United States since the Great Depression, prior to the 2007-09 recession. Indeed, the over 11% unemployment rate attained in late 1982 remains the postwar era’s pinnacle (Federal Reserve Bank of St. Louis). During the 1981-82 recession, unemployment was widespread, but manufacturing, construction, and the auto
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Between 2007 and 2009, the Great Recession was a period of substantial overall deterioration (recession) in national economies around the world. The severity and timing of the recession differed by country (see map). The International Monetary Fund (IMF) declared it the worst economic and financial crisis since the Great Depression at the time. As a
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Most recessions, on the other hand, are brought on by a complex combination of circumstances, such as high interest rates, poor consumer confidence, and stagnant or lower real wages in the job market. Bank runs and asset bubbles are two further instances of recession causes (see below for an explanation of these terms). What are
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GDP growth indicates that the economy is expanding. More products or services are being produced and sold by businesses. To maintain a healthy economic system and keep up with population increase, an economy must expand. The economy is said to be in a recession when the GDP decreases. During a recession, fewer products and services
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The rate at which technical advancements, labor forces, physical and human capital, and natural resources grow determines an economy’s growth rate. As a result, these forces can be stated as follows in terms of the GDP equation: Example of Measures and Sustainability of Economic Growth Assume that a country’s labor portion of national revenue is
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The US economy will have a recession, but not until 2022. More business cycles will result as a result of Federal Reserve policy, which many enterprises are unprepared for. The decline isn’t expected until 2022, but it might happen as soon as 2023. If the Fed manages to prevent a recession in 2023, expect a
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