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Data response question (2)

Read the article Japan sees end to deflation curse and then answer the questions below. (You can read the article in the web window below, or follow the previous link to read the article in a new web window)


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Question 1

Define the terms:

  • inflation
  • deflation

Question 2

Using aggregate supply and demand diagrams, analyse the changes currently taking place in the Japanese economy.

Question 3

It has been said that "a small amount of inflation in the system is not a bad thing". Evaluate this statement.