Economy, asked by tashitsomu217, 9 months ago

discuss the effect of inflation on production, distribution, growth and social justice.​

Answers

Answered by gadadharrout321
4

Answer:

Inflation may or may not result in an increase in production. Also, inflation has a positive impact on production as long as the economy does not reach full employment stage. Further, if the wages and production costs start rising rapidly, then it negatively impacts production activities.

please mark as branliest

Answered by gratefuljarette
0

Inflation leads to increase of money in the economy because there is an increase in the income of the people. Due to which there is an increase in level of spending, production, employment, taxes and government revenues.

Explanation:

  • An increase in inflation has a cyclical effect where there is an increase in the income of the people. Due to which there is an increase in their level of spending. This in turn leads to increase in the production of goods and services.  
  • The increase in production leads to more opportunities for employment for people. The government increase the taxes and there is decrease in the savings of the people which is not good for  investments. When people pay more taxes it increases the revenue of the government
  • Inflation helps the government with their spending but on the long run it is not good for the economy. It brings down the value of money and there is an increase in prices of goods. People are not able to save money during inflation.

To know more about effect of inflation

What's inflation and its related effects on whole economy

https://brainly.in/question/10044326

Similar questions