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what is a major problem for businesses during a period of chronic inflation

According to the demand pull theory, what is responsible for inflation?demand for goods and services exceeds existing supplyAn accurate statement about the Great Depression would be thatit ended largely because of an increase in defense spending related to WWIIThe main economic variables that affect business cycles include all of the following EXCEPTAccording to the cost-push theory, what is responsible for inflation?The amount of moneya person has left of his or her income after taxes is calledThe lowest point in an economic contraction is calledWhat is the difference between seasonal unemployment and structural unemployment?seasonal unemployment occurs because of schedules; wheras structural occurs because people lack skillsCompared with the expenditure approach to calculating GDP, the income approach isAll of the following actions promote capital deepining exceptspending a larger portion of one's disposable incomeHow has the distribution of income in the US changed over the last 20 years?GDP is expressed in constant, or unchanging, prices calledHow does the Bureau of Labor Statistics determine how the market basket should change over time?The main economic variables that affect business cycles include all of the following EXCEPTAll of the following measures help promote technological progress EXCEPTProducts that would be used in calculating GDP includecars manufactured in Tennessee at a factory owned by a Japanese automobile companyWhich of the following is a result of unemployment that is very lowWhen the economy is working properly, what is the unemployment rate?The agency that maintains the National Income and Product Accounts isGNP minus the cost of depreciation of capital equipment isWhat is a major problem for businesses during a period of chronic inflation? Bringing on a consultant helps CEOs add the expertise and skills they need to address particular problems at particular times and can provide the best possible outcomes. Corporations also raise prices freely when the item for sale is something consumers need for everyday existence, such as oil and gas. Traditionally high inflation rates are considered to be damaging to an economy. Low interest rates discourage saving in the short-term and encourage consumption, which is exactly what the Fed is trying to achieve during a recession. However, this depends on price elasticity of demand -the higher the price (ceterus paribius) the less the business will sell. A wage-price spiral is a macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. The offers that appear in this table are from partnerships from which Investopedia receives compensation. Inflation can be a concern because it makes money saved today less valuable tomorrow. The higher the inflation, the more serious the problem is.

Companies have difficulties recruiting new workers. Inflation erodes a consumer's purchasing power and can even interfere with the ability to retire. "Explaining the Wage-Price Spiral and How It Relates to Inflation This can be done very quickly-so it's not as important as (c) - uncertainty in business planning.Still have questions? Wages also affect the cost of production and are typically the single biggest expense for businesses. Central banks of developed economies, including the They figure that because inflation rates are rising, the cost (in purchasing power) of paying the loan back will be less than the value of the loan taken out. Some companies reap the rewards of inflation if they can charge more for their products as a result of a surge in demand for their goods. if the business is dependent on a raw material in the manufacture of its product, it is possible to fix the cost of that raw material in the forward markets for a certain period of time. If there is high inflation and the federal government spends less and raises taxes the government is utilizing .? Typically, inflation results from an increase in production costs or an increase in demand for products and services. If the economy is performing well and housing demand is high, home-building companies can charge higher prices for selling homes. If inflation is higher than nominal wages, then real incomes fall. Owners have to spend money to make money during a growth period… (a) - it is difficult to anticipate costs during a high inflationary period BUT in a market economy the business can increase it's selling price. Asked by Wiki User. Cash flow problems are the second most common reason why small businesses go bust, according to research from CB Insights. However, in a modern economy, this kind of hyperinflation is rare. What Is A Major Problem For Businesses During A Period Of Chronic Inflation? Just a few of the challenges I see businesses facing that are best addressed with the help of a consultant include: Uncertainty about the future. The answer would be A. However, it's the demand from consumers that provides the corporations with the leverage to raise prices. Companies also play a role in inflation, especially if they manufacture popular products. It is a simple reason. (a) - it is difficult to anticipate costs during a high inflationary period BUT in a market economy the business can increase it's selling price. Being able to predict customer trends, market trends etc. A system that collects macroeconomic statistics on production, income, investments and savings. The KEY thing about anticipating costs is to hedge against as many variables as possible i.e. personal savings levels. By Roma Priya Hit by the Covid-19 slump followed by social distancing and a nationwide lockdown, businesses are experiencing major impacts no matter how established they are and are having to re-look at how they manage and operate their business including re-visitation of their business plan.

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