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Solved: Why is disinflation so costly for an economy Are there ways to reduce these
Chapter 0, Problem 3(choose chapter or problem)
QUESTION:
Why is disinflation so costly for an economy? Are there ways to reduce these costs?
Questions & Answers
QUESTION:
Why is disinflation so costly for an economy? Are there ways to reduce these costs?
ANSWER:Step 1 of 3
Disinflation is a situation in the economy where the price level is falling where the output level falls below the potential level. Thus, the unemployment rate increases as disinflation takes place.