What are some of the troubles that could occur in the economy if inflation rate got as high as 8% or 10% per year?

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Business

Rory Murphy

29 March, 16:13

What are some of the troubles that could occur in the economy if inflation rate got as high as 8% or 10% per year?

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Answers (1)

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Anya Hebert · Answer 1

Some of the troubles that could occur in the economy if inflation rate get as high as 8% or 10% per year are:

1) Foreign investors will avoid the country.

2) Money losses value very fast causing an increase in the prices of goods and services.

3) The economy becomes unstable making the the government leaders to loose credibility.

Explanation:

The type of inflation that gets as high as 8% or 10% is called Galloping inflation.

Some of the troubles that could occur in the economy if inflation rate get as high as 8% or 10% per year are:

1) Foreign investors will avoid the country.

2) Money losses value very fast causing an increase in the prices of goods and services.

3) The economy becomes unstable making the the government leaders to loose credibility.