Answer to Question #61604 in Economics of Enterprise for Joshua

Question

Technically, price level stability is the absence of market inflation and deflation. The latter, however, referring to an increase in equilibrium prices, and the former to a significant price cut. Both positive and normative economists are challenged to critically examine and evaluate how the two market phenomena occur as they may create adverse economic impacts on economy both at the national and local levels. The former is further expected to propose economic and socio-political interventions and mitigations to cushion their impacts

What is wrong the staement?

Answer 1

The statement is wrong, because it is not right to compare inflation, which refers to macroeconomics, with the change in equilibrium price, which refers to microeconomics, because there are different reasons and factors, that influence the change in the inflation and the equilibrium prices.