Deflation is all about general level of prices falling . But why is deflation bad in general, should n't the lowering of price be good for the general public.
Looking closer into it, how does deflation happen? This generally happens when there is a reduced demand which can be due to a wide spread recession, people cuting their costs anticipating greater recession, job losses etc.
Reduced demand can lead to all major manufacturers reducing production which can lead to wider job loses.
This can change into a vicious cycle leading to depression.
Conversion Funnel
13 years ago
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