Review:
Deflation
overall review score: 3
⭐⭐⭐
score is between 0 and 5
Deflation is a decrease in the general price level of goods and services in an economy, which results in the increase of purchasing power of currency.
Key Features
- Decrease in the general price level
- Increase in the purchasing power of currency
- Potential negative impact on economic growth
Pros
- Decreased prices may benefit consumers by increasing their purchasing power
- Can lead to lower interest rates, making borrowing more affordable
Cons
- Deflation can lead to reduced investment and economic stagnation
- May result in job losses and wage reductions