Mastergp
Verified member
They are different things that could cause inflation to occur and they include the following:
Increase in demand:
When the demand for goods and services is greater than supply, this results in inflation.
Low production:
Low production of goods and services can lead to their scarcity and when supply cannot meet up with demand, inflation set in.
War:
War is seen as the major cause of inflation as people no longer produce, resulting in high volume of money pursuing fewer goods.
Increase in salaries and wages:
When salaries and wages are increased, without corresponding increase in supply of goods and services, it can lead to excess money in circulation chasing fewer goods.
Population increase:
A sudden rise in population will result in a corresponding rise in Dena d for goods and service and if there is no corresponding rise in supply, it will result in inflation.
Level of importation:
High cost of importing raw materials can lead to high cost of goods, which is passed to chasing fee goods and services
Inadequate storage facilities:
When goods produced cannot be stored for future use,it can lead to scarcity, resulting in inflation.
Increase in demand:
When the demand for goods and services is greater than supply, this results in inflation.
Low production:
Low production of goods and services can lead to their scarcity and when supply cannot meet up with demand, inflation set in.
War:
War is seen as the major cause of inflation as people no longer produce, resulting in high volume of money pursuing fewer goods.
Increase in salaries and wages:
When salaries and wages are increased, without corresponding increase in supply of goods and services, it can lead to excess money in circulation chasing fewer goods.
Population increase:
A sudden rise in population will result in a corresponding rise in Dena d for goods and service and if there is no corresponding rise in supply, it will result in inflation.
Level of importation:
High cost of importing raw materials can lead to high cost of goods, which is passed to chasing fee goods and services
Inadequate storage facilities:
When goods produced cannot be stored for future use,it can lead to scarcity, resulting in inflation.
