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Research two periods in history, one where the United States experienced an increase in inflation a

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Assignment: Research two periods in history, one where the United States experienced an increase in inflation and
the other an increase in unemployment. Write a paper discussing the causes and outcomes. Use the aggregate
demand and supply models to analyze the causes and why they led to the inflation and/or unemployment.
The rate of inflation is also one other major factor that has been in news from last few years. As price
levels augment for goods and services, the US currency is now less powerful and buys less, resulting in a
quantifiable inflationary rate. In December 2013 it was 1.5% which actually has plunged down from 1.6%
in January 2011. Though, a minor change, but still extremely satisfying during present tough times. It was
recorded the highest in September 2011 with almost nearing to 3.9 %. [Blanchard, O. Zobeiri, H 2009]
The GDP of US financial system has increased to 2.60% extra in 4
th
quarter of 2013 as compared to in
3rd quarter. [U.S. Bureau of Economic Analysis] The augmentation in real GDP in the 4
th
quarter mainly
replicated positive assistance from exports, PCE, as well as nonresidential fixed investment.
Causes that can reason a fall in aggregate demand: The Keynesian Macro Economic Approach in
practical [Funa, L 2009]

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superior interest rates which diminish borrowing as well as investment
Diminishing real wages
Falling customer self-confidence
Credit crisis which source a turn down in bank lending plus consequently subordinate investment.
A time of deflation. Falling prices time and again persuade people to holdup spending. Also
deflation amplifies the real worth of debt causing debtors to be poorer.
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#$%&'
UNEMPLOYMENT 1930

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Assignment: Research two periods in history, one where the United States experienced an increase in inflation and the other an increase in unemployment. Write a paper discussing the causes and outcomes. Use the aggregate demand and supply models to analyze the causes and why they led to the inflation and/or unemployment. The rate of inflation is also one other major factor that has been in news from last few years. As price levels augment for goods and services, the US currency is now less powerful and buys less, resulting in a quantifiable inflationary rate. In December 2013 it was 1.5% which actually has plunged down from 1.6% in January 2011. Though, a minor change, but still extremely satisfying during present tough times. It was recorded the highest in September 2011 with almost nearing to 3.9 %. [Blanchard, O. Zobeiri, H 2009] The GDP of US financial system has increased to 2.60% extra in 4th quarter of 2013 as compared to in 3rd quarter. [U.S. Bureau of Economic Analysis] The augmentation in real GDP in the 4th quarter mainly replicated positive assistance from exports, PCE, as well as nonresidential fixed investment. Causes that can reason a fall in aggregate demand: ...
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