However, there is still much controversy about the specific threshold level of inflation that is appropriate for growth.
Inflation is measured commonly by changes over time in Gross Domestic Product (GDP) deflator or Customer Price Index (CPI).
GDP deflator is calculated by dividing the nominal GDP by the real GDP.
[tags: Inflation, Money, Currency, Monetary policy] - Economics Student’s Name University Name Date Instructor’s Name There exists a clear relationship between unemployment and inflation.
These two important terms of the economy are inversely related to each other. Philips first reported the tradeoff between unemployment and inflation, it has been called after him as Philips curve.