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Identify the factors that lead to inflation and deflation, including demand-pull and cost-push for inflation, and demand-side and supply-side for deflation.

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Cambridge IGCSE EconomicsGovernment and the macroeconomy

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Identify the factors that lead to inflation and deflation, including demand-pull and cost-push for inflation, and demand-side and supply-side for deflation

  • This point belongs to Inflation and deflation, especially Inflation and deflation outcomes.
  • You need to be able to identify the factors that lead to inflation and deflation, including demand-pull and cost-push for inflation, and demand-side and supply-side for deflation.
  • The key ideas to know are Identify and Explain.
  • Use the linked flashcards and practice questions to check recall, then practise applying the idea in an exam-style answer.

Key concepts

IdentifyExplain

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Paper 2 structured question: Inflation and deflation

Paper 2Structured Questions1 marks

Description

Causes of Inflation and Deflation

Inflation can be caused by demand-pull factors, where demand exceeds supply, or cost-push factors, where production costs rise. Deflation can occur due to decreased consumer demand or increased supply efficiency.

  1. a

    State two causes of inflation.

    Aim for approximately 1 distinct marking point.

    [1]
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Cambridge IGCSEEconomics resources