impact of inflation on ppc
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The answer to your question depends on the type of inflation. In case of hyper inflation or high degree of inflation, PPC will shift to the left. This is because inflation will reduce the volume of production because of the following reasons.
1. Reduction in capital accumulation
2. Uncertainty in business implying unwillingness of entrepreneurs to undertake business risks in production
1. Reduction in capital accumulation
2. Uncertainty in business implying unwillingness of entrepreneurs to undertake business risks in production
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