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I just have a hard time believing deflation leads to perfect demand inelasticity at $0.
by Judson 14y ago
I just have a hard time believing deflation leads to perfect demand inelasticity at $0.
- brc 14y agoBecause it is completely unrealistic and total rubbish. That's why you have a hard time believing it. Of course, all those who insist that inflation is a superior state can't explain the economic effects of everyone deciding to purchase today before the prices go up, leading to much weaker demand and production in the future. Bringing forward spending excessively is just as problematic as send it backward into the future.