african jewelry wholesale manufacturers What is the difference between inflation and shrinkage?

evil eye wholesale jewelry The difference between inflation and shrinkage:
1. Different meaning and essence: Inflation refers to the amount of banknotes exceeded in circulation, which causes the economic phenomenon of banknotes and rising prices. Great supply than the total social supply; currency tightening is an economic phenomenon that is opposite to inflation. It refers to the economic phenomenon that the total price of the total price continues to decline within a period of time. Smaller than the general supply of society.
2. Different performance: The most direct manifestation of inflation is the depreciation of banknotes, rising prices, and decreased purchasing power. Failure tightening is often accompanied by the phenomenon of decline in production, market shrinking, decreased corporate profit margins, decreased production investment, increasing unemployment, decreased income, and weak economic growth. The main manifestations are low prices, and most commodities and labor prices have fallen.
3, different causes: The cause of inflation is mainly that the total social demand is greater than the total social supply, and the amount of currency issuance exceeds the actual amount of currency in circulation. The cause of currency tightening is that the total social needs of society are less than the total social supply. The long -term industrial structure is unreasonable, forming a buyer's market and export difficulties.
4. Different harmfulness: Inflation directly depreciates banknotes. If the income of residents does not change, the living standards will decline, causing the social economy and living order to chaos, and it is not conducive to economic development. However, in a certain period of time, moderate inflation can stimulate consumption, expand domestic demand, and promote economic development. Large tightening leads to a decline in prices, which is good for residents' lives to a certain extent. Essence
5. Different governance measures: The most fundamental measure for governing inflation is to develop production and increase effective supply. At the same time, measures to control the amount of money should be adopted, and measures such as moderate and tight monetary policies and fiscal policies should be adopted. To regulate the tightening of currency, we must adjust and optimize the industrial structure, comprehensively use measures such as investment, consumption, exports and other measures to drive economic growth, implement positive fiscal policies, stable monetary policies, correct consumption policies, and adhere to the policy of expanding domestic demand.
The connection between inflation and shrinkage:
1, both are caused by the general supply of social needs and the general supply of society, that is, the imbalance of currency and circulation in circulation in the circulation.
2, the two will distort the price signal, affect the normal economic life and social and economic order, so it is necessary to take effective measures to suppress it.
Iflation (inflation), concise definition: refers to under the conditions of currency circulation, due to the actual demand of the currency than the actual demand of the currency, that is, the real purchasing power is greater than the output supply, which leads to the depreciation of the currency. Generally rising. Its essence is that the overall social demand is greater than the total social supply (far away is less than requested). Unlike the depreciation of the currency, the overall inflation is the decline in the value of the currency in a specific economy, and the depreciation of the currency is the decrease in the relative value of currency between the economy. The former affects the value of this currency in China, while the latter affects the value of this currency in the international market. The correlation between the two is one of the disputes in economics. Inflation refers to "currency".

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