ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -What exactly is stagflation? Stagflation is the extreme economic situation, a peculiar combination of stagnant growth and rising inflation leading to high unemployment. Generally, rising inflation is a sign of a fast-growing economy as people have more money to spend higher amounts on the same quality of goods.

Detailed explanation-2: -“Stagflation” is a combination of high inflation and economic stagnation.

Detailed explanation-3: -Stagflation is an economic cycle characterized by slow growth and a high unemployment rate accompanied by inflation.

Detailed explanation-4: -Inflation is the rate of increase in the overall price level of goods and services in an economy. Stagflation describes a combination of high inflation and economic stagnation as reflected by a slow growth rate and high unemployment.

Detailed explanation-5: -Stagflation occurs when the economy stagnates and prices rise. It is often accompanied by high unemployment rates, rising costs and a fall in the nation’s gross domestic product (GDP). Stagflation affects consumers by decreasing their purchasing power, which can drastically slow down an economy’s growth.