Can you tell me in the business cycle, explain how prices, unemployment, interest rates, money supply, and output are effect by the inflation and recession?
The higher the rate of inflation, the smaller the percentage of goods & services that can be purchased with the same amount of money. When the prices of goods reach their ever higher stage, people cut on overall spending, and save more. As a result, GDP declines. This makes the companies to cut their costs as well and they lay off workers which brings unemployment. ChaCha!
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