Cost-push and demand-pull inflation


1. Define cost-push and demand-pull inflation. Discuss cost-push and demand-pull factors in Russian inflation in the 1990s.

2. a) Discuss the statement: "Russian currency crisis was caused by the outflow of capital due to the Asian contagion".

b) Why actual (market) exchange rates in developing and transition economies are usually below the Power Purchasing Parity (PPP) exchange rate (the "real exchange rate")?

3. What is exchange rate based stabilization and money based stabilization? Discuss advantages and disadvantages.

4. What are different models of privatization? What transition economies followed particular models? Discuss mass privatization from efficiency and equity perspectives?

5. What type of financial transfers is more economically efficient? Income or in kind transfers? Why?

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Macroeconomics: Cost-push and demand-pull inflation
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